Nvidia board taps Wachtell to probe Jensen Huang over affair and security risk

Nvidia's board said Tuesday it has handed the investigation into CEO Jensen Huang to Wachtell, Lipton, Rosen & Katz, tasking the firm with finding out whether company secrets or national security were compromised. The probe will be led by Joon H. Kim, a former acting U.S. attorney for the Southern District of New York who joined the firm earlier this month, according to Law360.

The board called the review thorough and independent, noting the independent directors had retained Kim and his team. It's the same investigation the company flagged on Sunday.

That was the day Huang admitted to an affair with a woman who reports in The New York Times and the Financial Times have tied to Chinese intelligence. The revelation landed as the chipmaker was already facing fresh scrutiny over what it knew about sales of its restricted AI chips to Chinese companies.

Investors reacted hard. Nvidia shares fell 6% on Tuesday as the market weighed the possibility that the scandal could push Huang, the company's co-founder and CEO, out the door. The board's move is aimed at steadying a company thrown into turmoil by its chief executive's conduct.

CNBC said the story is breaking and more updates are expected.