What was Jensen Huang thinking?

Quick note before we start the show this week, one of the things we have been most emailed about this year are emails from people asking when we are reopening our merch store. Last time we opened it, we sold out of our merchandise very, very quickly. As of this week, it is reopened. If you are an incognito mode listener, you've already gotten an email offering you substantial discounts in the store. If you're not an incognito mode listener, you can still buy beautiful search engine t-shirts, tote bags, and our beloved hoodies have returned. Go to searchengine.show, click on the link that says merch. There's also a link to the store in the show notes. One more thing, if you're a subscriber, there is a special hat only for subscribers. It's my favorite piece of merchandise we've made. The hat announces you as the boss of a podcast called Search Engine. All right, a few ads, then our show for you this week. This episode of Search Engine is brought to you in part by Framer. We've all seen what happens when a quick landing page idea gets buried under a mountain of developer tickets, tedious handoffs, and endless delays. If your team needs a website that feels meticulously handcrafted without taking months to ship, you need to check out Framer. Framer is the AI website builder that helps creators, teams, and businesses ship production-ready sites faster than ever while getting every detail right. Prompt, inspect, edit, and publish in one place at a whole new pace. Think of it as a creative partnership. AI agents bring incredible speed and scale, while your team brings the taste, judgment, and final say. Instead of leaving you with a half-baked first draft, Framer's agents work directly on the canvas alongside you, drafting pages, building custom code, managing CMS content, optimizing SEO, and auditing for bugs, so everything stays fully editable and instantly publishable. Learn how you can get more out of your site from a Framer specialist, or get started building for free today at framer.com slash search for 30% off a Framer Pro annual plan. That's framer.com slash search. Rules and restrictions may apply. This episode of Search Engine is brought to you in part by Raycon. Black Friday is right around the corner, and Raycon is making your decision effortless with up to half off site-wide. I use their upgraded everyday open earbuds continuously throughout my week, whether I'm exercising, running errands, or working. They're a great pick over my other headphones because they give me fantastic audio while remaining completely tuned in to my environment. Their open-ear setup lets you enjoy rich sound without blocking ambient noise, which is a game changer for outdoor safety and staying present. The lightweight construction incorporates a customizable dual-axis hook for a snug all-day fit. Alongside tactile buttons for seamless track and volume navigation. Add in multi-point pairing for instant device switching, 35 total hours of charge, a 30-day trial period, and millions of satisfied owners, and it's the ultimate upgrade. Go to buyraycon.com slash searchengineopen to get up to 50% off site-wide during Raycon's Black Friday sales. Thanks to Raycon for sponsoring. Hello. This week we are covering a very fast moving story. The scandal that has led to the downfall of NVIDIA CEO Jensen Huang. There are new details emerging literally every few hours, but what we have for you here is an episode on the backstory and context. What to actually pay attention to as these headlines roll in. ♪♪♪ ♪♪♪ ♪♪♪ ♪♪♪ ♪♪♪ ♪♪♪ ♪♪♪ ♪♪♪ ♪♪♪ ♪♪♪ By now, you've almost certainly heard the news. NVIDIA CEO Jensen Huang announced to his company that he had an affair, that he cheated on his wife with a woman who the U.S. government believes to be a Chinese intelligence asset. There's a lot we don't know, there's a lot we're still learning, but the big question is just this. What was he thinking? ♪♪♪ Jensen Huang's reason for being, for years, has been to make NVIDIA the dominant graphics chips company in the world. And he had succeeded so well at this one job that the entire U.S. economy is right now uncomfortably yoked to NVIDIA's future. A future that has become shaky in ways that were unimaginable just a week ago. Jensen has also done this at the exact moment that the American public's anger about data centers, about the rush towards data, and about his AI development is at its height, when concerns about corruption are at an all-time high. Everything about this story screams that it will be a huge ongoing scandal in the months to come. A lot of the coverage so far has tried to answer that question by looking at Alice Wong, the woman Jensen had an affair with. I suspect the better way to understand this story is by looking at what has always been Jensen's biggest desire, which is to sell as many NVIDIA chips as possible. China is an enormous market. The U.S. government has tried to restrict NVIDIA's ability to sell chips there because it believes that the country whose labs have the best chips will win the AI race. Jensen believes the government is wrong to block him. The fight is very important to Jensen. He's done a lot in public to try to win it. And the questions this year are going to be, what did he do in private to win it? And did he knowingly break the law? Because billions of dollars worth of NVIDIA's chips have been reaching China, allegedly through the woman he was dating. That's what the core of the scandal is going to look like once people's interest in the sex part of it boils off. So that's where we'll spend the bulk of our attention today. Let's get into it. On Monday, I spoke to Leo Schwartz, a reporter for The Information. Leo covers export controls, the rules the government sets around where U.S. companies are allowed to sell their products overseas. When we spoke on Monday, he admitted he is not used to so many people clicking on his stories. Like you were on a beat, it wasn't sleepy, but you were on a beat that prior to this was like, took, you had to do more work to make people interested in it. Yeah, I don't think export control policy is always the sexiest of subjects. I actually had a former White House official tell me last week that maybe 20 people in the world cared about export control policy. I think that is rapidly changing, especially because now you have so many of the most powerful people in the world drawn to this. Jensen, of course, Trump, who has been one of, Jensen's main allies in D.C. along with David Sachs. And then this question of whether NVIDIA was either motivated by Chinese intelligence or at least was leaking secrets potentially inadvertently through this relationship that just got unearthed. So to step back, everything that we learned this week, I believe is a direct consequence of something very boring sounding that happened way back in 2022 during Joe Biden's presidency. An export control policy is the only rule in the world that can control rule change. Every other podcast this week is going to tell you this is a story about sex because they think you think sex is exciting. But what it's really about is how on October 13th, 2022, the Federal Register issued a new rule called because what that rule meant in English is that American companies like NVIDIA were banned from selling their most cutting edge chips to China. Which for China meant their AI companies were now locked out of the best chips. It is the latest source of tension between the United States and China. President Joe Biden is accused of weaponizing technology for imposing sweeping controls on sales of semiconductors to Beijing. What's behind this decision and how much is it down to politics? This is Inside Story. This was moments before the AI race took off. Weeks before chat GPT 3.5 took the world by storm. And so most Americans at the time could be forgiven for not having strong opinions about semiconductor policy. But Joe Biden's administration really did. China is trying to move ahead of us in manufacturing them. It's no wonder, literally, the Chinese Communist Party actively lobbied against the Chips and Science Act that I've been pushing in the United States Congress. Biden's desire to keep American chips out of China wasn't just a headache for China. It was also a headache for NVIDIA. In 2022, sales to China had accounted for a quarter of NVIDIA's revenue. To the Biden administration, the trade-off was clearly worth it. The United States has to lead the world in producing these advanced chips. This law is going to make sure that it will. There was a concerted effort in the Biden administration starting in 2022 when there was more awareness or visibility in D.C. and in the Biden administration that an AI arms race was starting and that it would be between the U.S. and China. And at that point, there was an effort within the Biden administration to make sure that the U.S. and China led by different tech advisors there to create export control policy to ensure that the most advanced chips, again, mainly from NVIDIA, weren't making their way to China. And so how does Jensen Huang initially react when this ban comes down? So our reporting showed that at the time, NVIDIA, which you have to remember, didn't start out as an AI company. Really, their chips were mostly used in gaming. And it just happened to be the case that when AI really exploded into the tech scene, it turned out that NVIDIA chips were the best suited to train these models. So at that time, around 2022, NVIDIA had a very bare-bones government team in D.C. And what we've been told by people who were working on AI policy at that time is that they were really taken by surprise by this development. And they had to build up their government relations team when they realized that one of their big business lines of being able to export chips externally was being threatened. NVIDIA shares are sinking, hitting a new 52. week low on news that the U.S. government is imposing new restriction on sales of its chips to China. China's a major market. How does Washington thread this needle? It's absolutely. So why were they when this ban comes down, though, you're describing this company that was not used to having to figure out how to sort of lobby the government to be allowed to get around export bans because people are not doing export bans of video game chips. Like nobody cares if other countries can play really cool video games. The Biden administration understands this is going to be like the raw material of the race. What is in videos like like they start spinning up the ability to to sort of fight back on this. But what was the argument they were making? Like what was Jensen Huang saying in twenty twenty two to the Biden administration to others about like why he should be able to sell these chips to China? There's been several different arguments that NVIDIA has employed over the years. I think one really crucial one is that these chips from Chinese companies like Huawei aren't actually that worse than NVIDIA. What's your reaction to The Wall Street Journal saying Huawei is advancing to catch up to your highest level chips? There's no question that Huawei is one of the most formidable technology companies in the world, and they're incredible in computing. They're incredible in networking technology and software capabilities, all of the essential capabilities to advance AI. And they have they've made enormous progress in the last several years. In Jensen's public statements, he'll claim China is about to unseat NVIDIA's chips like any moment, making this decision to cut him off from their consumer market pointless. How far behind do you think China is? China is not behind. Are they ahead of you? China is right behind us. I mean, we're very, very close. But remember, this is a long. Another argument is essentially saying, if AI super systems are going to be built around the world, don't you want them being built by U.S. companies and giving U.S. companies the edge here? Why would we not allow this industry to go compete for its survival, for this industry to go and proliferate the technology around the world so that we could have the world be built on top of American technology so that we can maximize our economic success, maximize our geopolitical influence, maximize this technology industry doing such a vibrant time, such a pivotal time to allow it to thrive? Otherwise, China is just going to build up their own. Very capable chips systems and, you know, U.S. companies are going to lose out on all that money and also probably on a lot of soft power by having the hardware actually made in the U.S., which, as you can tell, are probably somewhat competing arguments, along with a third one, which was as more and more chips were being used in China for AI capabilities, that chip smuggling wasn't actually dynamic and that it was largely impossible to do. Governments understand that diversion is not allowed and there's no evidence of any AI development. Chip diversion. You know, recognize our data center GPUs are massive. These are massive systems. The Grace Blackwell system is nearly two tons. And so you're not going to be putting that in your pocket or your backpack anytime soon. And so these systems. That last clip, particularly striking. Jensen publicly saying chip diversion, chip smuggling, doesn't happen, that there's no evidence of it. Chip smuggling is what this story is. Again, I think, is really about. Back during the Biden administration, the White House was worried that despite the new rules it had passed, China was somehow still getting its hands on smuggled, cutting edge NVIDIA chips. But NVIDIA at the time was adamant, saying nothing like that was happening. According to the information's reporting, Biden officials would have these strange meetings with NVIDIA's leadership. The White House would ask for help making sure that there weren't technical workarounds that Chinese AI companies could use to, for instance, hack together older NVIDIA chips into something cutting edge. But in these meetings, it was as if NVIDIA didn't really want to help. NVIDIA would not, quote, "productively engage." What we now know is that around the same time, Jensen was in some kind of a relationship with Alice Wang. Her web of companies would become a place you could go to if you had an AI lab in China and wanted to get these NVIDIA chips the U.S. was trying to keep away from you. At least $7.5 billion in NVIDIA chips would pass from Alice Wang's companies. To other Chinese companies. We know that now, but back then, that was a secret. All anybody seemed to know was that the Biden administration wanted to keep NVIDIA's chips out of China and that NVIDIA was being unhelpful. That was the status quo. Until 2025, when NVIDIA gets an enormous gift from the heavens. A new opportunity to try to change this export control policy the company hates so much. Ladies and gentlemen, the president of the United States. The second Trump presidency. Just a few months in, Trump gives a press conference at the White House, showing off his new collection of supplicating business titans. Well, thank you very much. Please sit down, please. Thank you. We have a lot of great political leaders and the biggest political leaders around, I guess you could say, but by far much bigger are the business leaders. It's not even close. I say that to my friends. They are in the room with his trademark silver poof, dressed for once. Not in his leather coat, but instead in a suit and tie, Jensen Huang. They're such new friends. You notice Donald Trump has not yet learned how to pronounce NVIDIA, but he does seem to understand what he has. And one of the most brilliant men that you'll ever meet, the man that's done in a short period of time something that is incredible. He's the founder, CEO and president of NVIDIA, Jensen Huang. He's producing up to 500 billion over the next four years to manufacture the most. Powerful AI chips entirely in the USA for the first time ever. Jensen, would you come up and say a few words? This is a smart cookie. Thank you, Mr. President. It's a great honor to be here. NVIDIA reinvented computing for the first time after 60 years. And this is what a processor looks like. It's on the right. Right. Jensen on the podium explains what a GPU is. 60,000 parts. After that, he starts kissing the ring. Within a year, the two will be very chummy. Here, you're watching the beginning of something. Without the president's leadership, his policies, his support, and very importantly, his strong encouragement. And I mean his strong encouragement. Frankly, manufacturing in the United States wouldn't have accelerated to this pace. Manufacturing. It's important to remember that. In his first term, NVIDIA didn't really have a relationship with the Trump administration. Again, they didn't necessarily have a reason to have a relationship with the Trump administration. They didn't have much of a presence in D.C. That obviously changed after the Biden administration. They realized that there could be a real threat with export controls. And the other important thing to remember is that at the beginning of the Trump administration, there wasn't necessarily a strong view on how export control policy should be shaped. Historically, China hawks have been a hallmark. It was a hallmark of the Republican Party. There's a lot of figures within the Trump administration who were China hawks. It came to be a dynamic that other officials in the Trump administration, like David Sachs, the venture capitalist who was the AI and crypto czar, would defend this more pro-innovation. We should be allowed to help American companies like NVIDIA be able to export abroad. But in those early months, Jensen began to have more and more of a presence within the White House, at Mar-a-Lago. And pushing this idea that there shouldn't be strong export controls, especially around exporting chips to China, and that they wanted to have a hand in being able to shape what those policies would look like. And so then what, like, how does life change for NVIDIA in this world where now they have a friendly White House? Well, you really start to see, I would say, in the spring of 2025, Trump announces that they're going to rescind one of the flagships, the flagship Biden administration policies on export controls. It was called the AI diffusion rule. The U.S. has formally moved to rescind the AI diffusion rule and made it clear it would no longer be enforced while the bureaucratic process of revoking the rule unfolds. Trump announces they're not going to enforce that. There's a big trip to the Gulf where they announce all sorts of new deals. What exactly do we need to know here? Is this giving NVIDIA exactly what it wants? Well, this is giving NVIDIA what it wants, but it's giving foreigners. Foreign governments like the United Arab Emirates and Saudi Arabia what they want to a number of countries. Again, another region that was likely going to be under export controls and Jensen's relationship with Trump becomes more front and center. So at that point, you really see the influence where NVIDIA's view on export controls, which essentially they should be able to sell externally to countries like China, begins to comport more one to one with what the Trump administration is doing on export controls. With a friendly White House, NVIDIA started throwing its weight around in ways that I think a lot of people would have found at minimum off-putting had they registered it. Leo has one story about a writer at a conservative think tank who wrote a piece for City Journal. City Journal is a fairly niche conservative public policy website. I read it. I think I know one other person who does. But in this City Journal piece, the writer had pointed out that NVIDIA chips were being smuggled to China, which we know they weren't. were. NVIDIA's government affairs team demanded a meeting with the writer, in which they insisted he give them the specific serial number of the literal individual smuggled GPU, which obviously he did not have. I also do not have the serial numbers of any GPUs that are in China. It's a very aggressive, defensive reaction, particularly given NVIDIA was actually in the wrong. The more concerning part that we know less about is the pressure NVIDIA seems to have been exerting on other AI companies. According to the information, OpenAI has declined to take a position on export control with China because Sam Altman is scared of alienating Jensen Huang. Whatever you think of Altman, it does not seem great that one of the most powerful people in AI is afraid of his chip supplier because of Jensen's market power, because of Jensen's political power. Companies will pursue their own self-interest. But it's strange, in the past two years, how much public attention from journalists like me was on the behavior of the AI software companies, OpenAI, Anthropic, while NVIDIA quietly stifled debate around a fairly important issue. I personally do not even know what I think America's policy towards China having American chips should be. I just know I'd like people to be able to talk about it in public without a five, well, four trillion dollar company breathing down their necks. But in the world we've been living in, where Jensen and Trump are besties, where NVIDIA has the chips everybody needs, the company has had a very free hand. What would have to happen for anyone to want to mess with the CEO of the most valuable company in America? The red balloon or brick of a stock market has been tied to. That was the status quo until just a few days ago. After the break, the honeypot shatters. This episode of Search Engine is brought to you in part by Base44.com. For more information, visit base44.com. When demand hits and new clients start signing on, your customer-facing experience needs to match the standard you set from day one. Far too often, delivering that experience turns into a messy patchwork of third-party embed links, disconnected forms, and fragmented portals that dilute your brand. Base44 changes that equation entirely. It's an intelligent platform designed to build the full production-ready solution under one roof. All you do is describe it in your own words, specifying what clients see, how information flows, and what happens at each stage, while Base44 takes care of the user authentication, security, and databases behind the scenes. This isn't a concept sketch or temporary sandbox. It's the live, dedicated client environment you actually ship to the real world. You keep complete control over every touchpoint, adapting the system on the fly as your business expands. Go to base44.com.search for 30% off the builder plan for your first year. That's base44.com.search for 30% off your first year. Base44.com.search for 30% off your first year. 100% Mongolian cashmere, Italian leather, and solid gold. With world-class cashmere sweaters starting at just $60, you can wrap up pure luxury for less. Quince cuts out the retail middlemen and works straight with ethical factories, offering premium items at 50% to 80% below typical department store prices. Give the gift of quality this holiday season. Download the Quince app for app-exclusive offers, or go to quince.com. Get free shipping on your order and 365-day returns, now available in Canada and the UK, too. And when Quince asks where you heard about them, please let them know it was Search Engine. Welcome back to the show. The last time we talked about Jensen Huang on Search Engine, it was three and a half weeks ago, and I think three and a half realities ago. It was a long conversation with his biographer, and when I saw the headlines this weekend, he was the first person I wanted to talk to. Do you mind saying your name and what you do? Yeah, my name is Stephen Witt. I'm the author of The Thinking Machine, a book about NVIDIA and Jensen Huang. I called Stephen because I thought he, more than most, could get to the heart of the real question I had. What was Jensen Huang thinking? What might have been on his mind when he began to possibly ruin his own life? Stephen had been thinking about this, too, and he said this story, it is about Jensen's relationship with this woman, Alice Huang, but it's also about the relationship Jensen led NVIDIA into with her company, Megaspeed. Megaspeed. If you'd visited Megaspeed's website a couple years ago, what you would have seen was the homepage of a very generic-looking cloud computing company, a data center company based in Singapore, whose website bragged about its close relationship to NVIDIA. So it appears that this company, Megaspeed, was spun off from a Chinese company about 2023, and they bring in this woman, Alice Huang, and another guy as sort of the co-founders of this business. Alice Huang. We know she's a Chinese woman who began her career working for the Chinese state media outlet as a broadcaster, but transitioned eventually into the investment world. When Biden passed that export control ban, restricting some chips from going to China, Huang saw an opportunity for Megaspeed. The plan? Build data centers in countries outside of China, but then rent that capacity to Chinese AI labs, a workaround. And Megaspeed had this advantage that many American companies would have killed for. In late 2023, NVIDIA announces that Megaspeed is one of its preferred neocloud partners in Asia, and they're going to build big AI data centers together. And what does it mean to be a preferred neocloud partner? It means that they're more likely to get NVIDIA, the latest NVIDIA chips, that this is a preferred customer when the latest drop comes out, like you have special access to it. NVIDIA's business model can sometimes look like Supreme or NVIDIA's business model can sometimes look like Supreme or Pokemon, where there's people lining up to buy the latest equipment and getting an allocation is actually really hard. So, Megaspeed is going to be a preferred partner. That's already a little sus, because there's a lot of US firms that would want access to this stuff. But with these neoclouds in Asia, Jensen just sees an enormous market opportunity there, and he wants to help seed the market. Oh, and Megaspeed is one of like five or six of them. So it's not that shocking, at least at first. But they very rapidly grow to be one of his biggest customers. In Asia, out of nowhere, it's not clear who they're supplying. And it's not really clear who they are, right? Like, this is kind of a business that nobody knows anything about that nobody's ever heard of. Because if like, if XAI wants a bunch of NVIDIA GPUs, we know what they're using them for. If OpenAI gets a bunch, we know what they're using for. Nobody knows what product Megaspeed and Alice Huang are actually making. Yeah, who are their customers? Right? Like, who are they selling? Who are they selling this to? Who, you know, presumably, you know, Malaysia does not have a very advanced AI development program. The only customer in Asia, realistically, is going to be China, right? And so Jensen's point of view, and I think this is something that is a little hard to understand. He's actually a little desperate. Why? He's terrified of China. He's terrified, and this is going back because he's been in the hardware business for 40 years, or however long it is. What he has seen happen over and over is a U.S. hardware firm develop some kind of hit product, innovative product, and then Chinese competitors knock it off, and the U.S. firm goes bankrupt. That is the entire, like, problem that NVIDIA has faced its entire existence going back to the video game days. How to avoid being commoditized by Chinese hardware suppliers. And so Jensen's fear is that if he doesn't sell this equipment to China, that they will start to undercut. This is, in fact, exactly what happened more recently with the electric car. This happened to Elon and Tesla, and now BYD is selling, you know, electric cars for $10,000. It's very competitive. Jensen is worried that same thing is going to happen to him. And so what he has decided is the way to get around this is to, you know, essentially become the default supplier in Asia and not let some smaller, scrappier competitor form that will come and raid him from below. This always been Jensen's biggest fear. It's the innovator's dilemma. And so he's trying to block that from happening. So what might look to some people on the outside like an attempt to capture market share, which it also is, but knowing Jensen, this is actually a defensive move for him. He's terrified of what will happen if he doesn't do this. And so, you know, he meets Megaspeed, he befriends Alice Huang, and then they start to appear together quite often at dinners and stuff. And there's always other people around. There's nothing that you would look at and immediately say they're having an affair, but their body language is a little bit different. a little weird, and people start whispering, both inside the company and around there. And the Times first picks this up in 2025 and report on Megaspeed, but, you know, they stop short of saying that Jensen has a romantic relationship or any kind of special relationship with this woman. Rereading that New York Times story from 2025 now, what's so striking is how the story just sat there on the internet for a year, like a piece of unexploded ordinance. The Times had a lot of this already. They reported that, quote, commerce department officials had been investigating whether Megaspeed, which has close ties to Chinese tech firms, is helping companies in China sidestep American export restrictions. And the paper noted that Jensen Huang had been seen drinking with Megaspeed executive Alice Huang, that she'd bragged to some associates that she could summon him to a bar and then done it, and that it was unclear where her company had gotten the billions of dollars it needed to buy all these NVIDIA chips. At the time, NVIDIA's spokesperson, when asked about Jensen's relationship to this mysterious woman, said, quote, our field operations teams often host groups of customers and partners at conferences, and when Jensen is available, may ask him to visit to write updates on the market. Updates on the market. We now know that around the same time NVIDIA was publicly claiming all this, Jensen had already quietly hired a crisis PR firm. The type of company you call to navigate a scandal that may or may not come out. Stephen, when we spoke, was within just a short walk of Megaspeed. This mystery box that this month appears to be finally cracking open. I'm actually in Singapore right now. Megaspeed is right across the bridge. They're right across the bridge in Malaysia in the state of Johor. And these data centers, it seems to me that they were like dummy data centers. So they would take NVIDIA equipment in, they would kind of pretend to install it in the data center, and then they would put something else in there, in fact, and then take the NVIDIA equipment, which was not supposed to be re-exported to China, and ship it on. And so that would have been, I think, hard to miss. I think it would have been hard for Jensen to miss that anyway, particularly if he's sleeping with the person in charge of the operation. So there is, in addition to, you know, kind of the classic fallout of infidelity, there's almost like a liability here for Jensen. A serious liability. A serious liability for Jensen and NVIDIA for even doing business with this company in the first place. Like, the Commerce Department was already investigating this company. And, you know, typically when something like this happens, there's a little bit of distance between the CEO and the actual kind of, like, misconduct, right? You know, you can always blame it on some underling or something. That can't happen, though, if you're sleeping with the customer. But so just so I understand, what seemed to have been happening, as far as you understand it, is that there was an incident that happened, and there was an incident that happened, and there was an incident in some neighborhood in Malaysia, people thought there was a data center. They thought that the big, ugly building was humming with chips. And in fact, the building was, like, empty, and the actual physical chips were being sent to China? I think the building operates. I think there is a data center there. That seems pretty obvious. And you can see it on the map. They won't let you in, but it seems like it does draw a lot of power, and it's legitimately a data center facility. Did you try to go to the data center? I'm trying to, but they're not letting anyone in. It's like trying to break into a jail. Like, I don't know. There's such a high security. There's no way they're going to let anyone in there. The thing is, this data center clearly had ties to Alibaba, which is a leading Chinese firm. And so the export restrictions really specified that certain of Jensen's products were not to be shipped into China. And it seems like there's strong evidence that they actually were shipped out of this place. The other thing that happened is, even if they don't do that, then they can just set up the data center in Malaysia, and Chinese developers can access it. It doesn't have to be in China. They can just access the same equipment, from inside China. And that's obvious that that was happening. So my sense was, at least initially, that Jensen was either ignoring this or looking the other way or being like, well, you know, my customers, I can't figure out who their customers are, right? Like, it's too far down the chain for me to pay attention. But that level of plausible deniability, you know, disappears if he's involved with the CEO of the company romantically, which he appears to have been. And the Commerce Department has actually been investigating this for a while. For a couple years now, it looks like, going back to 24. I mean, the investigation into this started under Biden, and then appears to have been curtailed under Trump. So that's also pretty suspicious. But then I think what happened is that Jensen was very friendly towards China. And I think some of the China hawks in the Trump administration started to grow worried. And I think they started to say, Jensen has too much influence over the president. And if you believe the Times reporting, it's actually Marco Rubio who prepared this intelligence report or Marco Rubio's office. And they showed it to Trump. But it didn't seem to sway Trump's opinion of Jensen. So then I think they showed it to reporters. And I think that that's a power play. I think that that's the China hawks trying to reassert their supremacy in terms of giving advice to the president. I think there's some, you know, kind of like court intrigue going on here. One of the things I'm confused by is the fact that the Chinese have been trying to and I think it's like the kind of question that is just going to take 6, 12 or 18 months to answer. But like, when you hear that the CEO of one of the most valuable companies in human history that was subject to export controls, he didn't like the rule. He lobbied against the rule. He fought the rule. And like, things were being smuggled to China. And he happened to be having an affair with a Chinese intelligence asset who may have been a Chinese spy. And like, you can kind of imagine a continuum of explanations where on one side, it is, he kind of just thinks China should have the chips. And so it was very easy for him to be in an extramarital affair with someone who also held those views. And maybe he never even noticed she was a spy. Like, he may have been leaking information, but it doesn't mean he was like against the country. He was just very much for NVIDIA. And you could also imagine from the same set of facts and interpretation that was like, very, very different. You know, like, that this person was intentionally helping another country in a sort of like treasonous way. And as someone who has actually like spoken at length to Jensen, who has thought very hard about his psyche, like, we are in the unfortunate position of trying to like, interpret a lot from some strange facts, which have not yet been filled in. But where does your intuition send you on this? It's a great question. My intuition tells me that Jensen genuinely believed that it was in everyone's best interest, including the United States, for him to have these export controls lifted. Now, obviously, it's very good for NVIDIA's stock price to have, these export controls lifted. So maybe he was just kind of talking his book, as they say. He was giving the argument that was maximally beneficial to his own shares. You know, there's an argument to be made that locking China out of this is not good over the long term. I could hear that side of the argument. But when the person making the argument has been compromised by a Chinese spy, I don't think I'm going to listen to it anymore. Jensen's credibility here is destroyed. Regardless of what the facts are. The impression, the worst case scenario you gave, I don't think that that is true. But it's a position someone could make. It's hard to kind of disprove it. You know, like, he is in real trouble here in terms of reputation. His credibility is absolutely destroyed. I don't think anyone will ever listen to anything he has to say about China again. Certainly, I wouldn't. And, you know, you could see this was just a very sensitive topic for him all along. You know, his point of view of why this was good, never made a ton of sense. He never could really logically articulate why it was good for America to sell these chips to China. You know, his attempts to articulate that looked a little flimsy. If you look at the Dwarkesh Patel podcast, where they get in an argument about this from a few months ago, he gets quite agitated. Why is it that your policy, your philosophy leads to the United States giving up a vast part of the world's market? I guess the claim here is, Dario had this quote where he said, it's like Boeing bragging that we're selling North Korean nukes, but the missile casings are made by Boeing. And that's somehow enabling the U.S. technology stack. Like, fundamentally, you're giving them this capability. Comparing AI to anything that you just mentioned is lunacy. He gets quite agitated. That's normal for Jensen, but it's clear that he knew something sensitive was going on that he wasn't kind of revealing. The premise that even if we competed in China, we were going to lose that market anyways. I don't, you're not talking to somebody who woke up a loser. And that loser attitude, that loser premise makes no sense to me. I think Jensen became aware that this was a liability for him sometime earlier this year. Because what I have heard is that NVIDIA has gone back to Megaspeed and gone back to these other providers and essentially told them, okay, like, no more funny business. Like, you have to actually keep the chips on site. We're going to inspect it. And you have to demonstrate to us that more than 50% of your customers are not Chinese nationals. Even then, I'm sure China will find a way to access this equipment. But it's a somewhat higher bar. So I think, you know, Jensen is a guy going way back who was always willing to skirt the rules a little bit. And I think this is an underappreciated aspect of him. I called him a back-of-the-class guy on our podcast, meaning he knows how to cheat on a test. He knows how to rig a hardware benchmark in his favor. In the early days of NVIDIA, they were constantly getting sued for appropriating other people's trade secrets. That happened four or five times to them. So, you know, they're willing to operate in these gray zones, and pretty aggressively sometimes, too. When Stephen and I spoke at the beginning of this week, Jensen's fate was very unclear. I mean, it still is. But Stephen gave me the lay of the land as far as he could see it. The worst-case scenario is Jensen is forced out. And the true double worst-case scenario is Jensen is forced out, and then his wife divorces him. And then she independently becomes one of the largest shareholders in NVIDIA, which could happen. When you say worst-case scenario, you mean worst-case scenario for him? For him. It would also be very bad for NVIDIA shareholders because, you know, NVIDIA has a lot of what they call key man risk. NVIDIA is Jensen. I mean, it's just him, right? It's just him, and then there's, like, 60 people below him. I can't think of a single firm with the exception of maybe, like, SpaceX, where the CEO is so vital. To the existence of the firm. There's no plan to replace Jensen. There's no succession plan at all. Do you feel like you've been curious about this person longer than most people have? You spent more time trying to understand this person than most people have. Like, how much do you feel like this upsets your idea of him? And how much of it feels like, oh, knowing what you know about him, you can fit this into your understanding of the person? You know, I am not sure. I'm shocked that he had an affair. In Asia in particular, Jensen is like Taylor Swift. He's so famous, and people are constantly following him around. And women are, like, throwing themselves at him. And the temptations there must be extreme. It's not an easy position to be in, in some ways. I'm not excusing what he did, but I'm not that surprised. In our conversations, Jensen would go to such extremes. He would go to such extreme lengths to present himself as a normal guy. In fact, he screamed this at me once. I'm just super normal. I'm a totally normal guy. That's what normal guys are always screaming at people. It's just not true. It's just not true at all in any way. But that was his identity. And for whatever reason, that presentation of normalcy was something that he really, really wanted to display to the public and through his actions. But I never bought it. And so, I always felt there was something a little performative about all of it. And I think that makes me less surprised that he had an affair. You know, Jensen met his wife when he was 17 years old. They got married when he was 23. It was his only girlfriend he'd ever had. Now he's in his 60s. They've been married 40 years, and he's rich and famous. I'm almost more shocked that his relationship lasted as long as it did. Now, having said that, I am so shocked that this was the woman. Like, I cannot believe Jensen fell for this. He got played. Like, he got played, okay? This was not subtle. That's the thing. This was not like some kind of subtle influence operation. Anyone looking at these people, at this person at Megaspeed, would have instantly concluded in two seconds that they were a Chinese front. But you think he really did? Didn't know? Like, you don't think he chose not to? That's the thing. I mean, how could he not know? How could he not know that? I don't believe it's possible that he could not know that. And that's why I find it shocking. I don't understand how he could ignore the red flags here. I mean, I guess I do understand because people can behave in self-destructive ways, and I've seen that happen. But I just don't understand how someone at his company didn't just grab him and be like, Jensen, no. Like, don't know. You know what I mean? But he doesn't listen to anyone, so it's pure hubris, perhaps. Yeah, I mean, it's also funny. I mean, you said that at one point he was, like, screaming, like, I'm a normal person. And you were like, obviously, he's not a normal person. He's like, for better and for worse, he's not a normal person. But doing something really stupid that everyone else can tell is really stupid. That's normal. Very normal. Maybe the most relatable thing about it. I know. Look, everybody plays the fool sometimes. And I guess it's Jensen's turn. That conversation with Stephen happened early this week. As I am writing these words now, Thursday morning, Jensen Huang has resigned as NVIDIA CEO under pressure, which will not be the end of this story. Trump is claiming that the FBI will conduct an investigation. There will almost certainly be congressional hearings. We will ultimately learn much more about Jensen. Jensen's private communications around all this, as well as much more about the government side. Why, given that Trump officials were warned about this relationship much earlier, didn't they do anything about it? Thanks this week to the very busy, very exhausted reporters we spoke to on Mike, Stephen Witt, and Leo Schwartz. We will have links to their work in our show notes. We will also have a link to our earlier episode about Jensen Huang if you just want to hear the rest of his story. And if you have more questions about this story as it unfolds, we'd love to hear from you. We'd love to hear from you. As in, X marks the spot for the perfect platform that puts accounting, payments, payroll, and analytics in one place. So, you always have one clear picture of your business. Xero is more detailed than spreadsheets and just as powerful as other leading software, but it's simpler and easier to use. With visual dashboards, Xero makes it easy to understand your cash flow. You know exactly what's coming in and what's going out. So you can make smarter decisions that can help grow your business without feeling overwhelmed by the numbers. Join 5 million customers worldwide who use Xero to manage their finances. Learn more at Xero.com. That's X-E-R-O. This episode of Search Engine is brought to you in part by Square. You probably recognize Square as the sleek reader you tap your card on at your favorite local spot. But for business owners, it's so much more. Every Friday, when I grab pizza at my local spot, Frenzy, checkout is so quick and smooth. My receipt pops right onto my phone, and I'm earning loyalty rewards without even thinking about it. It just works. Square brings you everything you need. It brings your payments, inventory scheduling, and customer marketing into one intuitive system. You can accept every major card, use tap to pay, and with Square checking, your sales funds are generally available immediately. Everything is straightforward, beautifully designed, and simple to set up. Whether you're starting something new or looking for a better way to run the business you already have, Square gives you the tools to take payments, manage your day-to-day, and keep growing. And right now, you can get up to $200 off Square hardware at square.com/go/engine. That's S-Q-U-A-R-E.com/engine. Run your business your way with Square. Get started today. This episode of Search Engine is brought to you in part by Rocket Money. You know how keeping track of your finances can feel like a full-time job? Rocket Money is a personal finance app that helps find and cancel unwanted subscriptions, monitors your spending, and helps lower your bills so you can grow your savings. But they just launched something that changes the game entirely. Introducing Rowan by Rocket Money, an AI-powered personal finance app. This app helps you grow your savings. making it easier than ever to stay in control. I started using Rowan this week. I asked how my spending was tracking for the month, and it showed me I was spending way more on dining out than usual. then helps me budget so that I wouldn't overspend. It takes all the guesswork out of managing your money. Try Rowan when you sign up for premium plus at rocketmoney.com slash search. That's rocketmoney.com slash search, rocketmoney.com slash search. Search Engine is a presentation of Odyssey. It was created by me, PJ Vogt, and Truthy Pinamaneni, who is also our show's editor. Garrett Graham is our senior producer. Emily Molterra is our producer. Fact-checking this week by Mary Mathis, with assistance from Julia Murphy. Theme, original composition, and mixing by Armin Bazarian. Our production intern is Piper Dumont. Our executive producer is Leah Reese-Dennis, thanks to the rest of the team at Odyssey. Rob Morandi, Craig Cox, Eric Donnelly, Colin Gaynor, Maura Curran, Josefina Francis, Kurt Courtney, and Hilary Schuff. If you have a business and would like to advertise on search engine, shoot us an email, pjvote85 at gmail.com, subject line advertising. That is also the email address where we take your questions. We are always looking for more questions. If you have one, please send it in. If you're a listener and would like to hear a version of our show without ads, you can sign up for incognito mode. That's our paid feed. You can also get bonus episodes, access to our weird online experiments, and you'll be first in line for tickets for our live events. We had one this week. You can find a link to subscribe in our show notes or just go to searchengine.show. If you'd like a much cheaper way to support us, you could rate and review us on Apple Podcasts or follow us on Spotify. Thank you as always for listening. We'll see you next week. RingCentral's AI Receptionist uses Voice AI to answer on the first ring, so you'll never miss a call again. In just a few minutes, you can personalize your own AI Receptionist to answer questions, route calls, schedule appointments, and even send texts in multiple languages. Plus, it's easy to scale. Create unlimited AI Receptionists across any phone system. It's all powered by one reliable platform for effortless AI communications. See for yourself at ringcentral.com. RingCentral, voice of your business.