A staggering $430 billion erosion in Nvidia’s market value over just 48 hours has sharpened Washington’s focus on the embattled chipmaker and its chief executive.
Fox Business host Larry Kudlow became one of the loudest voices demanding accountability Tuesday, urging Jensen Huang to immediately vacate his leadership role.
“Step down, Mr. Huang, right now,” Kudlow declared, framing the resignation demand as a matter of national security rather than personal culpability.
Kudlow was careful to draw a distinction, saying he was “not here to indict” Huang but that stepping aside during active investigations was the responsible course of action.
At the center of the controversy is a 2025 U.S. intelligence community report, first surfaced by The New York Times, alleging that a woman named Alice Huang smuggled advanced American AI chips into China while cultivating a close relationship with the Nvidia CEO.
Huang had initially stayed silent as an Nvidia spokesperson dismissed reporting about the relationship, but he later sent a message to company staff acknowledging he had been “unfaithful” to his wife.
Kudlow argued that the prolonged silence made matters worse, noting Huang had concealed the affair for what he estimated was “at least a year or two” before finally acknowledging it.
The Fox Business host, who previously served as a top economic adviser in the White House, said Huang had once been a credible industry voice, but that “with these honeypot national security revelations, he is no longer a good spokesperson for the AI revolution.”
Kudlow also warned that Huang’s continued presence at Nvidia’s helm could hand political ammunition to Democrats, predicting the executive would “end up giving the whole AI revolution a very bad name” once Congress changed hands in January.
Nvidia moved swiftly to demonstrate it was taking the matter seriously, announcing Tuesday that it had retained a former acting U.S. attorney to conduct an independent investigation into its CEO.
Republican Sen. Kevin Cramer of North Dakota, a member of the Senate Banking Committee, separately called on Huang to step down, telling Politico the risk of extortion posed by the situation was simply too great to ignore.
The political consensus around Huang’s future stands in sharp contrast to President Trump’s posture, as Trump publicly defended the executive just one day before Kudlow’s remarks, saying, “I just know Jensen very well. I just think he’s a very honorable man.”
Kudlow’s broader concern, beyond any single allegation, was that the chip-smuggling questions and the intelligence ties together represented an existential reputational threat to the artificial intelligence sector at a pivotal moment in its development.
