Key Points

• NVIDIA's stock price rebounded by 3% after falling for two consecutive trading days.
• Independent director hires external legal counsel to investigate allegations involving Jensen Huang
• Before NVIDIA releases its financial report on November 17th, pressure from Congress is increasing.

On Wednesday, November 11th, as external scrutiny of CEO Jensen Huang intensified, NVIDIA's stock price rebounded by about 3.2%, recovering some of the losses incurred over the previous two trading days. The declines in those two days had once eroded the company's market value by approximately $430 billion.

After falling 4.3% on Monday and another 5.5% on Tuesday, NVIDIA's stock price once traded around $174.29. Despite increasing pressure from Congress and an independent investigation by the board of directors, the stock price has since rebounded. The allegations suggest that Jensen Huang was once a target of foreign intelligence operations.

A statement issued by the board of directors on November 8 confirmed that an investigation supervised by independent directors is underway, while also emphasizing that NVIDIA has no reason to believe that confidential information or U.S. national security has been compromised.

NVIDIA's Board of Directors investigation expands, Congress demands an explanation

NVIDIA's independent directors have hired former federal prosecutor Joon H and law firms Wachtell, Lipton, Rosen & Katz to investigate the allegations involving Jensen Huang and Alice Huang. Alice Huang formerly served as an executive at Singapore-based cloud computing company Megaspeed.

It is reported that there are allegations that Alice Huang provided information to Chinese intelligence agencies while maintaining a private relationship with NVIDIA CEO. These allegations are still under investigation, and at present, there is no conclusion that Jensen Huang knowingly leaked company secrets or violated export restrictions.

This expanded investigation follows NVIDIA's earlier announcement that its board of directors had initiated an investigation. The initial investigation sparked questions from the outside world regarding the supervision of executives and the stability of the leadership team.

In addition, three chairmen of Republican House committees have requested a closed-door briefing with Jensen Huang on November 18th. In their official congressional correspondence, they asked Jensen Huang to respond by November 11th or to propose another date.

The Chairman of the House Foreign Affairs Committee, Brian Mast, also mentioned that if Jensen Huang refuses to cooperate, a subpoena may be issued. However, no subpoena has been confirmed yet, and the requirement to attend the briefing itself does not constitute evidence of improper behavior.

AI Infrastructure stocks strengthen, NVIDIA stock price recovers

The rebound on Wednesday also coincided with another round of buying interest in companies related to artificial intelligence, as CoreWeave announced results that were better than expected.

This cloud service provider, supported by NVIDIA, reported revenue of $3.66 billion for the quarter, a year-on-year increase of 168%; its backlog of orders reached $132.5 billion. These results have strengthened market confidence in the demand for AI infrastructure, despite ongoing concerns regarding financing.

The positive reaction of the market to the CoreWeave financial report helped semiconductor stocks recover, indicating that investors are still willing to support companies that demonstrate strong AI-related demand.

However, in addition to the overall industry adjustments, NVIDIA also faces uncertainties at the company's own level.

Bank of America has recently removed NVIDIA from its list of preferred U.S. stocks, while Wells Fargo has lowered the target price for NVDA from $315 to $300. Despite increasing concerns regarding corporate governance, both institutions have maintained a positive rating.

Meanwhile, the valuation of the semiconductor sector has clearly declined. Wells Fargo estimates that the sector has corrected by 38% from its peak in June.

NVIDIA's financial reports and export rules to China pose the next challenge

NVIDIA is scheduled to announce its financial results for the third quarter of fiscal year 2026 on November 17, which is one day earlier than the previously scheduled congressional briefing.

The company previously announced financial results showing quarterly revenue of $96.2 billion, of which approximately $89 billion came from its data center business. The company expects revenue in the next quarter to be around $108 billion, highlighting that the demand for advanced AI processors continues to persist.

However, NVIDIA's exposure to risks regarding technological restrictions between the US and China remains another source of uncertainty.

Members of parliament are once again pushing for stricter controls on the export of AI chips, which has further exacerbated market concerns: tighter regulations may impact NVIDIA's international sales and could have an effect on the revaluation of valuations for a broader range of tech stocks.