Nvidia's board has launched an independent investigation into whether founder and chief executive Jensen Huang was the target of a Chinese intelligence operation, after Huang admitted to an affair with a businesswoman whom U.S. officials reportedly concluded was passing information to Beijing.

Shares of the AI chip giant slid nearly 5% before the opening bell on Monday as investors weighed what the inquiry could mean for the man most closely tied to the company's rise.

In a Sunday letter to employees, Huang, 63, said he had betrayed his wife and hurt his children. "There is no excuse for what I did," he wrote, adding that he was deeply sorry and took full responsibility.

Who the woman is

The woman, Alice Huang, is not related to the Nvidia chief. She has been linked to Megaspeed, a Singapore cloud company that buys Nvidia hardware. U.S. investigators had been examining whether Megaspeed helped Chinese firms obtain advanced AI chips that Washington bars from shipment to China. News reports last month said officials came to view her as a Chinese intelligence asset. She has not commented publicly.

What the board will look at

A committee of independent directors working with outside lawyers will run the review. The board said it has no reason to think U.S. national security or company secrets were exposed but will examine everything available. It said Huang backs the inquiry and has pledged to cooperate. A company spokesperson said he plans to keep leading Nvidia without interruption. The board also voiced confidence in him and his team.

Beijing pushes back

On Monday a spokesperson for China's Foreign Ministry, Guo Jiakun, rejected what he called the so-called Chinese spy narrative as unfounded. Beijing described the reports as a smear. Megaspeed did not answer requests for comment on a public holiday in Singapore.

Questions from Congress

Three Republican House committee chairs wrote to Huang last week asking him to brief lawmakers privately on Nov. 18 about how Nvidia guards against foreign spying and about the relationship. The company posts quarterly results on Nov. 17 and is set to hold a major conference in Washington later this month.

Huang has pushed for looser limits on AI chip sales to China, arguing the world is better off building on American technology. The president on Sunday called him an honorable man and said the two had not discussed the probe. Some analysts said they still expect Huang to stay in charge, while warning that any doubt about his future adds risk for a company at the center of the AI race between the two superpowers.