Report Says Nvidia Chips Reached China; Microsoft Passes It in Value

Nvidia closed down 5.47% at $168.89 on November 10. Together with the prior day's 4.27% drop, the two-session decline reached 9.5%.

The new layer came from tech outlet The Information. It reported that CEO Jensen Huang's relationship with Alice Huang helped at least $7.5B of chips reach Chinese firms. Reuters said it could not independently verify the report, and Nvidia did not immediately comment.

According to Reuters, Microsoft overtook Nvidia intraday to become the world's second most valuable company. It was the first time that had happened since June 2025.

What The Information Alleges

At the center of the report is Shanghai Century Litong. The company was founded in June 2023 and won Nvidia preferred cloud partner status within months.

According to the report, about 240,000 H100, H200 and A100 chips entered China through this network after orders for export-restricted chips stalled. Part of the capacity reportedly served Alibaba, Tencent and smaller Chinese AI labs.

Alice Huang was an executive at Singapore's Megaspeed, which US authorities examined over shipments from Southeast Asia to China. Century Litong said it won its status through compliant channels and has no business dealings with her.

Nothing Is Binding Yet

Since October 2022, the US has required licenses to sell A100 and H100 chips to China. But the rule governs shipping chips to China; it does not by itself track where a partner outside China moves them later.

There is no charge and no regulatory ruling. The Information's report rests on two unnamed sources, and Trump said the FBI is looking at the matter from another angle.

According to the New York Times, Commerce's Megaspeed probe moved to the Justice Department after Nvidia contacted investigators in August 2025. The Justice Department's criminal inquiry continues. In Congress, Senators Jim Banks and Elizabeth Warren want the AI Overwatch Act, which adds congressional review of licenses, in the defense bill; it is not law.

The market did not read this as a lost sale. It read it as a new rule that could be written.

The Market Is Pricing More Than Sales

Comparing the value loss with the alleged sales and a possible fine shows what the price carries. The benchmark fine is the $300M Seagate paid in 2023 over sales to Huawei.

The rest of the gap comes from two other risks. One is the chance that Huang steps down; analyst Dan Ives estimates Nvidia would be worth 25% to 30% less without him. The other is tighter export rules that could put chip licenses for China under congressional review.

The chart below is live and shows the past three months from today.

What It Means for Investors

• The market is pricing not a fine but Huang's position and the chance of new rules covering China sales; the allegation itself is still unverified.
• The drop stayed specific to Nvidia; Microsoft took the lead because it fell less, and the chip index fell just over 1% at midday.
• The first threshold is the November 17 report: how management explains China revenue and the probe will show how much of the 9.5% drop sticks.
• The risk that would break the thesis is the AI Overwatch Act becoming law with the defense bill in December, tying licenses to congressional approval.

More detail: How to Read Earnings Day and Market Capitalization. Earlier chapters: Huang admitted the relationship and Nvidia's chip tracking.

This story is based on The Information's report as carried by Reuters, which said it could not verify it. Probe details come from unnamed sources cited by the New York Times; congressional reactions come from the Banks and Warren statement and Politico. The closing price is Yahoo Finance data and the earnings date is from Nvidia; the value loss is an estimate based on approximate share count.