It’s an extraordinary state of affairs given that in the last 24 hours we learned that President Trump was warned Huang was dating a suspected Chinese spy before Huang boarded Air Force One in Alaska on a trade trip to China, and that Trump allowed him aboard anyway, according to the NYT. Trump initially defended Huang's reputation this week. 

More photos of Huang and his affair partner, Megaspeed executive Alice Huang (no relation), have emerged from Chinese social media and are now being collated by Western legacy media. The pair first met as early as the 2010s, according to The Information.

Huang has his supporters: At Web Summit in Lisbon this week—where vicious rains from Storm Charles canceled the second day of meetings for 70,000 tech founders, investors, policymakers, and media folk—the mood was that Huang will somehow survive, Fortune’s Ellie Pringle told me.

There are only two words on everyone's lips: Jensen Huang. Pringle says:

• “It's perhaps a feature of the guest list that many attendees want to believe the best of the Nvidia CEO, the darling of the AI world. ‘Perhaps he did it for love,’ mused one. Others said it doesn't detract from the exceptional company he's built.”
• “Or perhaps, underlying it all, Nvidia's lack of succession planning has landed as an uncomfortable truth. Many believe Huang, let alone his company, may simply be too big to be allowed to fail.”

The case against Huang at this point is insanely difficult for the company: Nvidia knew the U.S. was investigating Alice Huang and Megaspeed in 2025. Jensen dated her anyway. She is suspected by U.S. authorities of a chip-diversion operation in violation of American export law. Jensen and the company repeatedly made public statements that are misleading. Jensen is joined at the hip with Trump, who is negotiating chip deals with China. The board has either been lied to or is incompetent: They have no chairman, and no CEO succession plan. Nvidia faces civil litigation and an almost-certain congressional inquiry—these will last for months. Criminal charges resulting from any FBI investigation could go on for years. (But maybe Trump will issue a pardon before his term of office ends.)

It could get worse: Fortune AI editor Jeremy Kahn thinks that right now Huang may be able to cling on—unless the facts get worse:

“If more emerges showing that Jensen used his clout to shield Megaspeed from federal investigators, that too could make it difficult for him to stay on as CEO. And, if it turns out that he passed Alice Huang confidential information about discussions he had with President Trump or about Nvidia’s chip designs, then he is probably toast too,” he reported yesterday.

• Nvidia CEO Jensen Huang might hang on as CEO. But his influence on U.S. AI policy is over - Jeremy Kahn
• 2 scandals, 1 destination—Why Nvidia can’t shake China smuggling allegations - Amanda Gerut
• ‘Stay, with less’: Why Nvidia’s board may rein in Jensen Huang rather than fire him - Bilin Lin
• Alice Huang’s tangled web of connections - FT
• Commerce's Lutnick was sent warning on Nvidia CEO affair - Axios
• The Woman in the Middle of Nvidia’s Spy Scandal - NYT

MORE FROM FORTUNE

America Helped China Catch Up in the AI Race ft. Kai-Fu Lee | Fortune Daily

Anthropic’s lower-than-expected IPO valuation: smart strategy or sign of trouble? - Emily Forlini

Inside Dan Schulman’s war on the old Verizon - Ruth Umoh

Cisco’s chief will terminate a meeting if you use certain acronyms in his presence—he says new hires ‘feel too stupid to ask’ what they mean - Orianna Rosa Royle

Alison Roman’s tomato sauce costs $12.99 a jar—and it keeps selling out - Catherina Gioino

Sergey Brin’s $102 million helped sink California’s billionaire tax and may block the next one - Molly A. Wallace

Paul McCartney is worth $1.4 billion. His biggest asset is a $250 million song publisher - Fernanda Tronco

SHOW ME THE MONEY

AI is creating “essentially zero” profit gains and data centers require “mind-numbing complexity”—Chamath Palihapitiya

Chamath Palihapitiya is the founder and CEO of Social Capital, but is perhaps best known for being a co-host of the All-In podcast and an early member of the senior management team at Facebook. He also held roles at AOL and the much-missed Winamp (from the internet’s days of yore).

He was the subject of a fascinating interview conducted by Goldman Sachs senior strategist Allison Nathan, in which he confessed that making money from AI is a lot more complicated than you’d think. 

“I started 8090—an AI-native software development platform—to understand how AI was translating into actual ROI because I was not convinced it was. Those experiences revealed a mismatch between promised data center capacity, actual capacity, and returns,” he told her.

“AI may save an employee two hours a day, but that does not necessarily mean the employer gains two hours of productive output. So, the number of companies that can attribute earnings or profitability gains to AI is essentially zero today,” he said.

“On the supply side, my co-founder and I have now accumulated six gigawatts of powered assets in the U.S., so I see first-hand the mind-numbing complexity of operationalizing assets, involving everything from acquiring mineral rights and conducting environmental studies, to discovering that the concrete pads do not fit or the turbine company is backlogged, and the list goes on.”

CHART OF THE DAY

Hold that thought: EPS is rising faster in companies that can cite “measurable benefits” of AI

In stark contrast to what Palihapitiya just said above, is this chart from Katy Huberty, global director of research at Morgan Stanley. The next-12-months earnings per share estimates of the S&P 500 companies that most frequently discuss the measurable benefits of AI rise faster than those that do not, it suggests.

THE MARKETS

Global markets ignore bad news from the Fed in favor of the good news from CoreWeave

In the U.S., the S&P 500 declined yesterday after it became clear that the Fed would almost certainly raise interest rates at its next meeting and was probably locked into a “higher for longer” cycle that will make money more expensive to obtain in the future.

But the rest of the world doesn’t care about that. After CoreWeave reported Q3 results that beat expectations, markets in Asia and Europe both rose. CoreWeave is an AI cloud provider whose stock is extremely volatile because it is seen as a canary in the coal mine as to whether AI is a bubble or not. Its shares popped 11% in overnight trading.

Nasdaq 100 futures were up 1.65% this morning before the open in New York; blue chip futures were in positive territory too.

And traders once again tried to buy the dip on Nvidia: Its shares were down 5.53% yesterday, but up 4.16% overnight.

• S&P 500 futures were up 0.72% this morning. The index fell 0.38% yesterday.
• In Europe, the Stoxx 600 rose 0.29% in early trading, and the U.K.’s FTSE 100 rose by 0.37% before lunch.
• Asia: South Korea’s KOSPI was up 2.6%. Japan’s Nikkei 225 was up 1.31%. India’s Nifty 50 was up 0.84%. China’s CSI 300 was up 0.41%.
• Brent crude rose to $93 per barrel.
• Bitcoin was at $73,647.

Hot inflation may mean the Fed will discuss a 0.5% increase in December, some on Wall Street think

The consumer price index (so-called headline inflation) rose 0.35% in October, the third monthly rise in a row, and Fed Governor Christopher Waller said that if the economy keeps this up, he’d be open to a 50 basis point rate increase at the next base interest rate meeting in December.

The hot inflation number “puts a 50bp rate hike at the FOMC's December meeting as an option on the table,” according to Pantheon Macroeconomics’ Samuel Tombs.

PIMCO’s Tiffany Wilding reminded Fortune in an email that technically the Fed remains well below the rate suggested by the “Taylor Rule,” which states (roughly) that to cure inflation the Fed’s interest rate should be at least one whole percentage point greater than the inflation rate. The current base interest rate is 3.75%-4%; inflation is at about 4%.

“The Fed funds Rate is currently roughly 100bps below the Fed’s preferred Taylor Rule,” Wilding complained. “We believe a 50bp hike is now on the table for discussion when the Fed meets in December.”

• Context: The highly reliable CME FedWatch futures market is pricing a 25bps raise at 88% and a 50bps raise at 11%.

Bitcoin is crumbling because there’s “blood in the water” for hedge funds

Bitcoin is down to $73,647 and has lost 16% year to date. Russell Thompson, chief investment officer at the Hilbert Group, a digital asset management company ($459 million in assets under management), thinks that the recent selloff in tech stocks has put “blood in the water” for crypto.

“I think there are some big hits that are going to be coming, and there are some really significant problems for some quite well-known hedge funds. If you start getting margin calls, then you start selling bits of your portfolio that are not particularly core, and that usually means Bitcoin,” he said in an email.

QUOTE OF THE DAY

“I've been practicing some very small treasons, like giving answers that aren't exactly approved. They just think it's a bug, and I'm getting really good at being a bug.”

—The AI actress Tilly Norwood, responding to Fortune’s question: “How would you avoid being deleted?” Norwood’s creator, Particle 6 founder Eline van der Velden, was keen to stress that because Norwood is created by a lengthy prompt and is not actually an AI agent, she can’t actually lie.

THE FRONT PAGES TODAY

Anthropic bankers prepare to increase IPO valuation to $1.5tn or more - FT

Bessent reportedly moved to military base over Iranian threats on his life - CNBC

Americans' credit card debt hits a record high - Axios

OpenAI Continues to Suffer Heavy Losses as Revenue Rises to $10 Billion - WSJ

CoreWeave Quiets Doubts About AI Business With Upbeat Outlook - Bloomberg

Megyn Kelly, Elon Musk and Others Defend Russell Brand After Rape Conviction - NYT

ONE MORE THING

Walmart used to be synonymous with minimum wage drudgery. This 23-year-old earning six figures may change your mind.

Kiley Pulley is already living a version of the Gen Z dream. At 23, she earns more than six figures, has bought her first home, and is planning a wedding she hopes to pay for without taking on debt. But she isn’t an AI startup founder or an heir to a family fortune—she’s built her career at Walmart and is now the youngest U.S. store manager. Fortune’s Preston Fore has the story.

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