How a celebration in Singapore set the stage for the Nvidia spy scandal

Chinese executives at the Web Summit in Lisbon raised concerns about potential alternatives to Nvidia during the conference on Tuesday. The scandal surrounding Nvidia's CEO, Jensen Huang, took center stage, with allegations of Chinese spying on the US artificial intelligence chip giant dominating the discussion. Huang admitted to an affair, and US intelligence officials suspect the woman involved of spying for China, a claim Beijing denies.

Nvidia's shares dropped more than 5% on Wall Street in afternoon trading. Larry Li, founder of Amino Capital, noted that there will be turbulence in the short term, but some players may play a more important role than Nvidia alone, citing US rivals Qualcomm, Google, and AMD as potential beneficiaries. YuanKang Zhang, head of strategy and innovation at Chinese company Cloudsky, emphasized the emergence of diverse chip manufacturers from China and the hope that the industry would not be easily affected by such events.

The spying allegations may reignite tensions ahead of US President Donald Trump's visit to China and could lead to tighter controls on Nvidia's exports to China, which have been restricted since 2022.