Nvidia board weighs in Jensen Huang's removal, in talks with outside firm to find replacement as second extramarital affair comes to fore
The latest allegations involve a senior company executive. Huang had earlier also been linked to Alice Huang, a Chinese businesswoman suspected of having connections with Chinese intelligence. Reuters reported the developments, quoting a source familiar with the matter.
Any decision to remove Huang could create major uncertainty at Nvidia, a company valued at nearly USD 4 trillion. He co-founded the chipmaker in 1993 and helped turn it into the world's leading supplier of artificial intelligence (AI) chips.
Reports about a possible leadership change have already affected the company's shares. Nvidia stock reportedly fell around 8 per cent in after-hours trading. Including Wednesday's decline, the company has lost nearly USD 600 billion in market value this week.
Bloomberg has also reported that Nvidia's board is working with an outside firm to identify possible successors because the company does not have a clear succession plan.
The controversy first emerged following reports about Huang's alleged relationship with Alice Huang. US intelligence agencies have reportedly linked the Chinese businesswoman to the movement of Nvidia chips to Chinese companies.
Uncertainty over Nvidia leadership
Huang's possible departure could leave Nvidia facing a major leadership challenge, as there is no clear successor ready to take over.
He owns around 3.6 per cent of the company's shares and has strong control over its operations. Dozens of senior executives report directly to him.
Market experts have warned that removing him immediately could be difficult because the company has not prepared a clear succession plan.
In a message to employees on Sunday, Huang admitted that he had been unfaithful to his wife and accepted "full responsibility". However, he did not share details about the relationship.
On the same day, Nvidia's board began an investigation into whether Huang had been targeted by a foreign intelligence operation. The investigation is being handled by independent board members with the help of external legal experts. At the time, the board had expressed confidence in Huang.
Nvidia shares fall as rivals gain
The uncertainty over Nvidia's leadership has also affected financial markets. US stock futures declined, while Nasdaq futures fell around 1 per cent.
Meanwhile, shares of rival chipmakers AMD and Broadcom rose by around 4 per cent and 3 per cent, respectively, in after-hours trading. Investors believe these companies could benefit if Nvidia faces prolonged problems.
Nvidia plays a major role in the global AI boom. Its investments and financial support also help several companies that buy its products.
Nick Ferres, Chief Investment Officer at Singapore-based Vantage Point Asset Management, warned that any slowdown could expose weaknesses in the wider investment cycle.
Huang founded Nvidia in 1993 with Curtis Priem and Chris Malachowsky. The company initially produced graphics processors for computer gaming. Later, its CUDA software expanded the use of these processors into general computing and artificial intelligence.
- PTC NEWS
