BRUSSELS — Last month, Nvidia chief Jensen Huang got Europe’s full red-carpet treatment from the likes of King Charles, French President Emmanuel Macron and German Chancellor Friedrich Merz.
Now it’s crickets.
As an alleged Chinese spy scandal engulfs the man running the world’s dominant AI microchips producer, potentially awkward questions loom for European leaders in both the public and private sectors who rubbed shoulders and inked deals with Huang. But the silence also reflects the cold economic and strategic reality that Europe has no homegrown alternative to Nvidia.
A German government spokesperson said Monday in response to a barrage of questions on the upheaval at Nvidia that it “does not comment on the media reports,” and that “we always adhere to the highest standards, including when agreements are being reached.” A European Commission spokesperson also had no comment on the matter.
In both Silicon Valley and Washington, investigators are already busy. Nvidia has opened an internal investigation into whether its CEO was targeted by a Chinese intelligence operation, after Huang developed an intimate relationship with a Chinese businesswoman suspected of trying to funnel intel on U.S. chips to Beijing. Huang has admitted publicly to having an affair.
The U.S. Congress, particularly its factions wary of China, is also set to take action. “The U.S. should immediately pause the shipment of advanced AI chips to China until we can get to the bottom of this incident and ensure our national security is not being undermined,” Rep. Michael McCaul, a Republican from Texas, and former chair of the House Foreign Affairs Committee, said on X.
In Brussels, the blow to the Silicon Valley giant might appear to be good news for those who warn of U.S. tech dominance in the AI race. But as with the recent results of the midterm elections, the woes at Nvidia don’t change Europe’s reality because the bloc is so reliant on the company’s AI chips.
“We don’t have any alternative, the design [of chips] is almost entirely U.S.,” said Dutch European Parliament lawmaker Bart Groothuis, one of the negotiators of the bloc’s latest chipmaking plan.
Groothuis decried Nvidia’s “bizarre monopoly position.”
Europe’s heavy reliance on Nvidia was on display during Huang’s October tour through Europe, which included receiving a medal from King Charles and sharing a stage with Germany’s Merz.
EU executives have been lining up over the past year as well: EU innovation chief Ekaterina Zaharieva met Huang on a trip to the U.S. this spring; and Cabinet members of EU tech chief Henna Virkkunen discussed in September a “possible meeting” between the digital czar and Huang, per an entry in the EU’s transparency register, which would also explore Nvidia investments in Europe.
The Commission declined to comment on whether that meeting is now off the table.
Indispensable
Being courted for investments is a status that not many U.S. tech executives still enjoy in Brussels. But Nvidia made itself indispensable to Europe’s efforts to keep up in the global artificial intelligence race since its powerful chips are necessary to train the complex and advanced models that Europe aspires to have.
Brussels was jolted awake to that reality when the outgoing Biden administration limited AI chip exports to a series of EU countries in early 2025, which triggered a diplomatic scramble across the bloc.
Since then, the EU has portrayed itself as a willing buyer of American AI chips, culminating in the EU’s promise to buy €40 billion of the chips as part of the EU-U.S. trade deal.
When the European Commission began an effort to build seven massive AI compute hubs at the end of July, an investment worth €30 billion, Nvidia was one of the three U.S. companies that were selected “to ensure … seamless access to necessary hardware.”
The bloc has only recently begun efforts to wean off its reliance on U.S. advanced chips through a new chipmaking plan it presented in June.
That plan warned that the bloc is almost “entirely dependent on the United States and Asia for the most advanced and leading-edge chips … including AI chips” and pitched an EU-based advanced chips factory as a strategic project “with the highest priority.”
It’s not even necessary to plough billions into a factory.
Nvidia itself doesn’t manufacture chips, it designs them — and then relies on companies such as Taiwan-based TSMC to produce them.
This all raises the stakes for Europe to become a force in chip design, a craft Nvidia has mastered over the years and that has made it the world’s most valuable company.
“The entry to that market is quite accessible, the knowledge to do better is also available in Europe,” Groothuis quipped.