Bessent blames Commerce for Nvidia chip leaks to China

Jensen Huang has resigned as Nvidia's president, CEO and board member, effective immediately. Chief Financial Officer Colette Kress will serve as interim CEO and keep her finance role while the board looks for a permanent successor, according to the company. The resignation on Thursday, November 12, ended Huang's 33 years at the company he co-founded. By Friday, the scandal had turned into an open dispute inside the Trump administration over why Megaspeed, the Singapore company at the center of the case, was never put on the U.S. trade blacklist.investor.nvidia.com

Huang admitted to an extramarital affair in a November 8 letter to employees. The letter did not name the woman, but she was later identified as Alice Huang, a former Megaspeed director whom U.S. media described as an alleged Chinese intelligence asset. Beijing has denied the spying claims, Le Monde reported. The board removed Huang after reports of two affairs, one of them with a direct report, Reuters reported.reuters.com+1

Bessent points at Commerce

On CNBC's "Squawk Box," Treasury Secretary Scott Bessent said Treasury, Defense, State and the U.S. Trade Representative's office "were in favor of putting Megaspeed on the entity list for months." He added that Commerce is in charge, "and you will have to ask them about their internal processes," CNBC reported. He said he was frustrated because President Trump "made it very clear that China should not receive any Nvidia chips above H100s."cnbc.com

Bessent said the real question was whether "Nvidia knew their client." He also asked whether the company had been selling to "what were obviously pass-through shell companies," according to Le Monde. CNN reported that Bessent confronted Commerce Secretary Howard Lutnick about Megaspeed in the Situation Room the week before. Megaspeed reportedly traded more than $4 billion worth of Nvidia chips over two years, France 24 reported.france24.com+2

How many chips reached China

Research firm SemiAnalysis estimates that more than 1.5 gigawatts of export-restricted Nvidia hardware has reached China, which could mean up to 1.5 million GPUs, Tom's Hardware reported. The firm suggested the scale of the leaks may explain why Huang's personal conduct became an issue now. However, it offered no direct evidence that Huang took part in illegal exports.tomshardware.com

What comes next

Nvidia shares fell sharply after the announcement but recovered during Thursday's session, and they rose in premarket trading on Friday, the Associated Press reported. Kress will lead the earnings call on November 17, Business Insider reported. Three congressional committee chairs have asked Huang to attend a closed-door briefing on November 18, France 24 reported. Bessent said the administration is "constantly working to close down" what he called "a lot of leakage in the system."businessinsider.com+2