There are decades where nothing happens, and there are weeks when decades happen. The CEO and founder of Nvidia just experienced the latter, and so did many in tech, media, government. I have a variety of thoughts after spending the past several days reading and recording podcasts about these (figurative and literal) affairs, but let me express one unpopular sentiment at the outset: what’s happened to Jensen Huang this week is tragic and depressing.

I have a disease that makes me sympathetic to almost anyone who ends up on the wrong end of viral outrage and panic, and unfortunately it’s flaring up again. Huang is one of the greatest CEOs in American history. He’s still hyper competent, he’s been incredibly important to the growth of the AI ecosystem, and frankly, he’s among the most sane of the contemporary tech leaders we have on offer. His fall from grace has been not only stunning but seemingly coordinated. It’s been painful to watch on a human level, and of course it has ominous implications for the tech industry. Regardless, though: what’s done is done. Huang’s reputation has been irreparably harmed, his wife and family have been humiliated over the past two weeks, and he just lost control of the world-conquering company that he founded 33 years ago, immediately throwing Nvidia’s future into a world of post-Jobsian uncertainty.

It’s an incredible coup for the Ministry of State Security if this was all a Chinese op, but honestly, I’m not convinced it was. That’s point number two. The entire media establishment and most of our government seem to have taken it as a given that Alice Huang was a spy for the MSS, but a) the sourcing there is based entirely on the vague and classified claims of intelligence services who despise Huang, while b) “spy for the MSS” can mean different things. Was she a 43-year-old operative trained by the MSS to honeypot powerful executives and obtain proprietary information, or was she a businesswoman who was (like all other Chinese citizens) obligated to cooperate with the MSS when the agency discovered her affair with Jensen? I would bet on some version of the latter (“asset,” not spy), and I think it’s more likely the spy claims were invented altogether (were they?) than it is that Alice Huang was some kind of Chinese Keri Russell executing a classic sexual blackmail scheme.

All that noted, I truly don’t know. We may never know. And one thing is certain: if Alice Huang was spending billions of Chinese investor dollars to obtain high-end Nvidia hardware that was banned for export to Chinese companies and may have later been smuggled into mainland China … she was not doing that without approval from the Chinese government. So, not a CCP agent, but not not a CCP agent—and definitely not someone that Huang should have felt comfortable sleeping with. How in the world could he be so stupid?

On the other hand, should we really be surprised? Whenever Jensen Huang discusses China, I’m reminded of Upton Sinclair: “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

Here was Huang in a recent interview with Bloomberg, answering Emily Chang’s question about engagement with China’s tech sector by saying, “We must work with them in every possible way.” Then there was Huang talking to Dwarkesh Patel in April, going viral when he angrily called it “lunacy” to worry about the CCP and PLA using advanced American hardware to execute AI cyberattacks. Equally infamous around D.C. was Huang’s conversation with Brad Gerstner last year, in which he declared that the label “China hawk” is a “badge of shame.”

Both Huang and his company were lobbying against stepped-up export controls on AI chips as early as 2022, and were (legally) circumventing the spirit and expressed purpose of those export controls with the A800 chip in 2022, the H800 in 2023, and the H20 in 2024. He’s continued to lobby against export controls throughout the Trump administration and continued his attempts to sell AI chips to both mainland China customers and China-linked entities in Malaysia, Thailand and Singapore. To be fair, of course, anyone who’s followed this space for the past several years will remember that Nvidia has been joined by Intel, Qualcomm and everyone else in the American semiconductor industry in lobbying multiple administrations against new China restrictions. Likewise, Google, Microsoft, and Oracle all have sizable footprints in Southeast Asia providing Chinese customers with access to high-end compute.

Huang has been by far the loudest and most powerful of those voices, though, and now he will fall the hardest. That’s one way to understand what happened over the past two weeks: Jensen had a giant target on his back among many in tech and government who favored stricter restrictions on Chinese chip access, his mistakes with Alice Huang and Megaspeed gave those critics ammunition, and for reasons that remain unclear (but fun to wonder about!), some of those folks have decided to pull the trigger now.

Reports of an affair with an Nvidia employee (and another one) might have been survivable three weeks ago, but certainly not after an international scandal involving sex with an alleged Chinese intelligence asset who was the managing director of an Nvidia customer that was likely violating U.S. laws. Once his critics got those leaks going, it was 50/50 at best that Huang kept his job, and 100 percent guaranteed that his (and Nvidia’s) credibility in Washington would be permanently decimated.

So was Huang a victim of what was ultimately an American intelligence op to leak incriminating reports that would discredit him and his policy agenda? As far as this month’s disclosures, that’s almost certainly closer to the truth than imagining a years-long honeypot scheme overseen by the MSS to influence his views. But I draw the line at calling Huang a victim, and to be clear, that’s not why I feel bad for him.

To state the obvious: Huang broke some obvious CEO rules here (don’t dip your pen in Chinese shell company ink?) and exercised horrible judgment, evidently in multiple dimensions. With Alice Huang, he also publicly lied about the affair in explicit terms, further undermining his credibility and possibly withholding material information from investors. “Our relationship, our interactions, have been related to Megaspeed, and it was all completely normal and not unusual,” Huang told Bloomberg at the end of October.

In the weeks and months to come, I imagine Congress will be eager to find out what else Huang may have been lying about. There will be more investigations, and there is likely more to find. All such inquiries will of course begin with Megaspeed itself, a Singaporean company with a large footprint in Malaysia that was identified by Culper Research last spring as an Nvidia customer that appeared to be funded and controlled by Alibaba, circumventing U.S. export controls in full view of Huang, who visited Megaspeed “every few months” and was accompanied by representatives from Alibaba “every single time.”

Indeed, if national security secrets were not necessarily compromised by Jensen’s affair with Alice Huang (the Nvidia board’s initial construction), it’s very plausible that national security laws were broken by Megaspeed if Jensen’s customer was effectively an Alibaba cutout controlling Megaspeed data centers and purchasing export controlled chips, 50,000 of which may have made it to China. Many on Capitol Hill will argue that U.S. security interests were compromised in turn, all of which may have been downstream of Nvidia’s knowing (or unforgivably negligent) participation in the scheme (in which case Nvidia was breaking laws, too).

But again, none of this is all that surprising. As I told Bill Bishop in our episode of Sharp China this week, the potentially incriminating details of that customer relationship have been part of the public record for nearly a year, yet I never thought to mention them on the podcast. Because what was there to say? Everyone in D.C. had just accepted that this is just how Nvidia does business. Every few months there’s some new, sketchy customer highlighted by Bloomberg or the New York Times, sometimes there’s a DOJ indictment, Nvidia’s answers are never satisfying, and yet the company appeared to be bulletproof until a sex scandal shined a light on exactly how shady all of this has always been. In the years since the Biden export controls took effect, the share of Nvidia’s revenue billed to customers with Singapore addresses rose from 8% to 22%, and in July 2025, Nvidia stopped breaking out the figures altogether.

During that same period, there have been lots of anecdotes in which Nvidia is said to have bullied members of Congress and the think tank community, using donations as leverage to influence policy positions of the latter group. Bill and I have been alluding to that bare knuckles behavior on our podcast for almost four years now, and The Information highlighted the company’s broadly unpopular tactics with a new report last week:

Government officials sometimes have felt bullied in exchanges with Huang. Officials at political think tanks say Nvidia officials have threatened to cut back on their funding for expressing views the company disagrees with. And Nvidia customers say they tiptoe around certain subjects, as OpenAI has, to avoid displeasing the chip giant. […]

One semiconductor industry executive who worked with Nvidia described the company’s effort to tweak its products and sidestep the [2022] ban as giving the Biden administration “the finger” and taking the stance that it did not have to negotiate with the government.

That often adversarial attitude toward some Biden officials came not only from Huang but also from Nvidia’s general counsel, Tim Teter, according to several people who have interacted with him. Those people recalled Teter using unflattering nicknames for government officials, academics and think tank scholars he did not like.

Under Trump, Huang’s interactions with the executive branch—and the President himself—have been considerably friendlier, which invites an entirely different spectrum of criticism and lines of inquiry. What happened to scuttle the Commerce Department’s investigation of Megaspeed, and where does the DOJ investigation stand today? Did Jensen Huang urge Nvidia counsel to reach out to the government on his mistress’ behalf? Those are fair questions that I’m sure a Democrat-controlled Congress will be asking in the months to come. Meanwhile: Nvidia donated $25 million to Trump’s ballroom and $1 million to Trump’s inaugural fund, with at least one policy flipping after Huang attended a $1 million-per-plate fundraiser and personally lobbied Trump to reinstate licenses to sell H20 chips to China (which had been allowed under Biden).

Whether attempting to buy ideological allies or bully opponents, Huang and Nvidia spent the past several years working tirelessly to subvert the democratic policy process. Lobbying is fine, but threats and bribes are not, and it always seemed to me that Nvidia tipped a bit too far over the line as they navigated D.C. That’s why the company came to be despised by most of Congress, not to mention the vast majority of the Trump Cabinet (who may be doing some of the leaking here).

Meanwhile, Ben Thompson has laid out an elegant case for selling high-end chips to China, but it has to be said that Jensen himself never came close to approximating Ben’s humility or strategic coherence. Not only has Jensen never once advocated for restricting the sale of semiconductor equipment to China (as Ben did), but his public answers on incredibly difficult chip questions have been evasive …

…. misleading …

and outright false.

By now it should go without saying that chip diversion is systemic and Nvidia is benefiting, while yes, the U.S. is confident that high-end Nvidia chips were used to develop DeepSeek, a model that can be extended to a variety of Chinese military applications. (Another fun detail: the day after the Trump admin initially restricted the sale of H20 chips in April 2025, Huang flew to Beijing to grovel before Vice Premier He Lifeng. Nvidia later claimed that trip was scheduled regardless of the export curbs, but who really knows?)

For as brilliant and charming and tenacious as Jensen Huang may be—and as omnipotent as he may have seemed to people in the tech industry—we should be clear that his fundamental stupidity is not confined to multiple cases of workplace infidelity. Zooming out, this is a man whose technology became economically critical almost overnight, and it thrust him into a role navigating a geopolitical environment he simply could not handle. Suddenly forced to balance market-altering interests in both China and the United States, I don’t think Huang ever really understood either country’s leadership.

No one in American history has ever been less effective at winning friends in Washington than Huang and Nvidia, yes, but that was only part of the problem. What really drove the disconnect in D.C. was Jensen’s assumption that U.S. concerns about economic engagement with China were purely a function of vibes and misunderstandings, not sincerely held security principles and bitter lessons from the past 25 years. Perhaps he needed to believe all that in order to rationalize his company’s behavior, but when he said last year that China is “not an enemy” and that “China hawk” should be a badge of shame across D.C., I was immediately reminded of Biden’s Ambassador to the PRC, Nicholas Burns, who said last year, “I went to China with hawkish views and returned to the U.S. even more hawkish than when I arrived. I saw up close the true nature of its authoritarian government and its ambition to undercut the U.S. at nearly every turn.”

Almost everyone with a security clearance leaves their time in government more concerned about China than they were when they entered public service. Without reciting a laundry list of malign CCP and PLA behaviors that could support those conclusions, I will only note that Huang was in China constantly and he seemed to be blind to all of them. Conversely, you hear the word “hawk” and probably imagine Donald Rumsfeld, but the China hawks in D.C. tend to be folks who are aware of a wide spectrum of security vulnerabilities and are unwilling to talk around those risks for the sake of share prices or political correctness. Their prescriptions are not always a good idea, but their signature trait is noticing problems and proposing action, not necessarily agitating for World War 3.

Huang repeatedly belittled those people with both his rhetoric and his company’s behavior, and indeed, he questioned the patriotism of anyone who dared to object. In so doing, he was waging war with not only large swaths of the U.S. security apparatus, but also the realities of Xi Jinping’s China that would inevitably make it impossible to sustain his position without looking naive, selfish, and unforgivably reckless.

So why did I feel bad for Huang this week? Because I’m a sap, first of all, and I’m never rooting for anyone’s public disgrace. But also because this is a man who seemed incapable of recognizing how and why this story might eventually end horribly for him. And now that we’re here, I can’t help but wince at just how much worse it’s going to get.

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Sharp Text is extension of the Stratechery Plus podcasts Sharp Tech, Greatest of All Talk, and Sharp China. To subscribe and receive weekly posts via email, click here.