Ryan Fedasiuk, a senior fellow at the think tank Foundation for American Innovation, says Huang has played such an important role—and become so close to the president—that he has become load-bearing for the entire US AI industry.
“On the one hand, Huang is irreplaceable. He built Nvidia into the juggernaut it is today, and he was the visionary behind the GPU, which has sustained the intelligence revolution,” Fedasiuk says. But he says that the company, which is indispensable to the AI industry, has to come first.
“He has to be replaceable as the CEO of the world’s largest company, at $4 trillion in capex.”
Nvidia shares fell more than 4 percent on Monday, even as broader stock market indices rose.
The board’s investigation will most likely focus on whether Huang violated any company policies, Yoffie says. But the FBI could also investigate whether laws were broken, and Congress may decide to look into whether Huang’s affair influenced the US government’s policy on selling chips to China.
Nvidia didn’t immediately respond to WIRED’s request for comment.
The scandal also raises serious questions about whether China may have gained sensitive information about US AI companies and the government’s strategy on China, Fedasiuk says.
Huang’s affair appears especially damning given how outspoken he has been in recent years against calls for more aggressive technology export controls on China. His credibility on the topic could be permanently in doubt.
Both the first Trump administration and the Biden administration imposed export controls designed to limit China’s access to Nvidia’s chips, as well as to technology required to mint advanced semiconductors. In his second term, however, Trump loosened these controls, giving China access to older generations of Nvidia chips; it was better to make China reliant on US technology, the argument went.
Sam Bresnick, a research fellow at Georgetown University’s Center for Security and Emerging Technology, says the Huang scandal is likely to accelerate efforts to crack down on chip exports.
“There was going to be more of an impetus to control what chips are getting sent to China anyway,” he says. “I expect there to be more scrutiny on what’s going on, what’s getting sent to China. I think there’s also going to be more scrutiny from the Commerce Department.”