Jensen Huang has resigned as president and chief executive officer of Nvidia, the company he co-founded and turned into one of the most important manufacturers of artificial intelligence chips. Huang is also leaving the board of directors with immediate effect.
Chief Financial Officer Colette Kress is taking over temporarily while the board searches for a permanent successor from among internal and external candidates. The decision comes after a week of turmoil linked to Huang’s admission of an extramarital affair and claims that he was the target of a foreign intelligence operation.
Shares lost hundreds of billions
Huang, 63, sent a message to around 42,000 employees in which he admitted:
Following the admission, Nvidia shares fell, with nearly $430 billion wiped off the company’s market value over two trading days. In an episode of the Deep Dive podcast, Daily Mail deputy business editor John-Paul Ford Rojas said that Huang’s departure could have an even greater impact.
“Some analysts say that Jensen Huang’s departure would wipe out between 25 and 30 percent of its value. So we are talking about around $1 trillion,” Ford Rojas said.According to him, such a loss would be roughly three times HSBC’s market value. “We would like to think that a company of Nvidia’s scale and importance does not depend on one person. But that is actually one of the problems it is facing,” he added.
Investigation into a possible espionage operation
The scandal unfolded against the backdrop of reports about Huang’s relationship with Alyssa Huang, who is not related to him. She worked for the Singaporean technology company Megaspeed, which is being investigated by the U.S. Department of Commerce for allegedly helping circumvent U.S. restrictions on the sale of advanced artificial intelligence chips to China.
U.S. officials believe that Alyssa Huang may be linked to Chinese intelligence. China dismissed the claim as unsubstantiated smearing. Ford Rojas himself stressed that the woman’s motives and actions remain unclear.
“She may have been trying to obtain Nvidia chips or learn more about them, or even influence Huang over the issue of U.S. sanctions against China. But at this stage, that is only speculation,” he said.Nvidia’s board launched an independent investigation into the case. In its official statement, the directors said they had no reason to believe that national security or the company’s secrets had been compromised.
Another alleged affair increased the pressure
The pressure on Huang intensified following a report by The New York Times about an alleged relationship with Kimberly Powell, Nvidia’s 48-year-old vice president of healthcare. According to the report, she was among the executives who reported directly to Huang.
Neither Nvidia nor Powell has confirmed the claim. The issue of the relationship between the two is separate from the investigation into a possible foreign intelligence operation.
Following the resignation, Colette Kress is taking temporary control of Nvidia, while the company must find a permanent leader at a time when the market is assessing not only its financial performance but also its dependence on Huang’s presence.