What happened
Chosunbiz reports that Chinese AI-related stocks have diverged sharply since Nvidia CEO Jensen Huang's scandal and resignation. Shares of AI developers and cloud providers such as Alibaba fell more than 10% on the Hong Kong exchange between the first trading day after the scandal broke (the 9th) and the morning of the 13th, while Zhipu AI and MiniMax dropped 9% and 7.8% respectively on the 12th after spiking on individual catalysts the day before. Chinese AI chipmakers moved the opposite way: Cambricon jumped 6% at the open on the 9th and rose more than 25% over five sessions, with Moore Threads up 14.8% and Meta X up 16.5% over the same period.
Chosunbiz reports that Chinese AI stocks swung sharply after the Huang scandal. As of the morning of the 13th local time, Alibaba had fallen more than 10% on the Hong Kong exchange from the first trading day after the scandal became public on the 9th. Zhipu AI and MiniMax spiked on individual catalysts on the 10th but then dropped 9% and 7.8% respectively on the 12th and were moving sideways at the time of reporting.
Chinese AI semiconductor makers surged: Cambricon jumped 6% at the open on the Shanghai exchange on the 9th and was up more than 25% over five sessions through 10 a.m. on the 13th. Moore Threads rose 14.8% and Meta X rose 16.5% over the same period.
The context, per Chosunbiz: on the 8th, Huang admitted to an affair with businesswoman Alice Huang (Chinese name Huang Le), who is suspected of being a Chinese spy and accused of illegally distributing export-controlled Nvidia chips into China. Huang resigned as Nvidia CEO the day before the admission, and two additional allegations of affairs have since emerged.
Chosunbiz also cites a Reuters report from the 12th, citing industry sources, that a major Chinese cloud company is discussing locking in Nvidia chip computing capacity at overseas data centers for an extended period; some Chinese companies have asked overseas data center operators about reserving AI servers in advance, and smaller AI labs are said to be exploring Nvidia chips through Southeast Asian cloud providers.
Source details: biz.chosun.com
Why it matters
The split reflects investor expectations that Washington will further restrict Nvidia's advanced chip exports to China following allegations that Alice Huang, with whom Jensen Huang admitted an affair, illegally distributed restricted Nvidia chips into China. Chinese AI model developers and cloud companies depend heavily on Nvidia's high-performance semiconductors, and successive U.S. export controls since 2022 have already restricted the A100, H100, A800, H800, and H20. Further curbs could slow Chinese AI model development and service expansion, while benefiting domestic chipmakers like Cambricon, though Chosunbiz notes Nvidia still holds the edge in high-end performance and its software ecosystem, making short-term replacement difficult.
The market moves price in a plausible policy shift: U.S. politicians are actively pushing new restrictions. Chosunbiz reports that on the 9th some Republicans and Democrats issued a joint statement urging quick passage of related bills, Senate Majority Leader Chuck Schumer echoed that call, and House Speaker Mike Johnson pressed for action the day before.
Bills under consideration include the AI Oversight Act (strengthening congressional oversight of advanced AI chip exports), the Chip Security Act (mandating location tracking of semiconductors), and the Remote Access Security Act (regulating remote use of U.S.-made AI chips by Chinese companies via overseas data centers), with Republicans also seeking to fold provisions into the National Defense Authorization Act. For Chinese AI firms, the practical stakes are supply; for Chinese chipmakers, the stakes are market share.
Interactive Mechanism: How It Actually Works
Explore the underlying technology behind this development interactively.
crm_get_transaction(id='4092').Which component of an AI application is the machine-learning model itself?
What to watch next
Watch movement on the three pending U.S. bills and any NDAA provisions, further export-control decisions, and whether Chinese firms' overseas -lock-in deals materialize.
Whether Congress passes the AI Oversight Act, Chip Security Act, or Remote Access Security Act, or attaches chip-restriction provisions to the National Defense Authorization Act.
Whether Washington formally tightens export controls beyond the existing restrictions on the A100, H100, A800, H800, and H20.
Whether Chinese cloud companies complete deals to reserve Nvidia chip capacity at overseas data centers, as Reuters reported was under discussion.
Whether Cambricon, Moore Threads, and Meta X can convert investor expectations into actual share gains against Nvidia's performance and software-ecosystem advantages.