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Nvidia CEO Jensen Huang Resigns After 33 YearsBusiness
Nvidia founder Jensen Huang has resigned as chief executive after 33 years, following a week of scandal and a board investigation, with chief financial officer Colette Kress stepping in as interim leader.
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Jensen Huang, the founder who led Nvidia for 33 years and turned it into one of the world’s most valuable companies, has resigned as chief executive, the company’s board announced on Thursday. Chief Financial Officer Colette Kress has been appointed interim chief executive and will continue to serve as executive vice president and chief financial officer while the board considers internal and external candidates for a permanent replacement.
The announcement ended several days of intense speculation about Huang’s future. Nvidia’s board met on Wednesday night to discuss his position after The New York Times reported that Huang had an additional extramarital relationship with a company executive. On Sunday, Huang admitted to having an extramarital affair, without naming the other person, and apologised to his family and colleagues.
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The board had said on Sunday that it would investigate whether Huang was the target of a foreign intelligence effort, after reports of his relationship with a woman US officials believe is a Chinese spy. According to CNN, US intelligence concluded in a classified memo issued in May that Alice Huang, an executive at Megaspeed, a Singapore-based Nvidia customer, was a Chinese intelligence asset. Nvidia said on Sunday that the board had “no reason to believe that either national security or NVIDIA secrets were compromised.”
The picture remains unsettled. Sources told CNN that the intelligence collected so far does not prove that Alice Huang was acting as a spy for Beijing, and Attorney General Todd Blanche said on Thursday that no conclusions had been reached by the Department of Justice or the FBI about who she is or is not. President Donald Trump also hedged on Thursday when asked whether the United States had determined that she was a spy.
Shares fall as investors weigh the future
Investors reacted sharply to the leadership shake-up. Nvidia shares dropped more than 10 percent in pre-market trading on Thursday and were down 5.53 percent at $164.13 by midday. The shares had already fallen 9.5 percent across Monday and Tuesday after Huang’s weekend admission and news of the board’s investigation, and they were down 27 percent from a peak in early October at the close of trading on Wednesday.
Rival chipmaker Advanced Micro Devices surged as investors weighed the competitive implications of Nvidia’s turmoil, rising after an analyst upgrade. Shares of companies Nvidia has invested in, including CoreWeave and Coherent, also fell as the uncertainty spread across the artificial intelligence sector.
Huang is widely credited with kicking off the artificial intelligence boom, and Nvidia sits at the centre of the market for the advanced chips that power it. Analysts say the company is worth roughly $1 trillion less without him at the helm, according to estimates from Dan Ives of Yorkville Ives and Company, who called the resignation “a gut punch for Nvidia and the US tech industry.”
The succession question is complicated by the way Huang ran the company. He maintained an unusually flat organisation with 60 direct reports and no clear second-in-command, and he had previously said he did not believe in succession planning. The board now faces the task of finding a permanent chief executive for a company that has become synonymous with its founder.
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