Nvidia CEO Jensen Huang resigns, effective immediately

In a massive shake-up in the technology and artificial intelligence sectors, Nvidia has parted ways with its star co-founder and longtime CEO Jensen Huang amid a pair of reported affairs, one of which was with a woman suspected of spying for the Chinese government.  

What we know:

Not long after reports emerged about a second affair involving Huang, one that involved a senior executive who reported directly to him, Nvidia’s board of directors met Wednesday night to decide the fate of the man who turned the company into the $4 trillion powerhouse.

In a statement released by Nvidia, the company says the Board of Directors announced Jensen Huang has resigned as president and CEO effective immediately. 

Colette Kress, current Executive Vice President and Chief Financial Officer of NVIDIA, has agreed to serve as Interim Chief Executive Officer.

What they're saying:

"NVIDIA’s strength has always come from its people, and together with our leadership team, I am committed to building on the extraordinary foundation Jensen created over the last 33 years," Kress said. "We will continue advancing the work that has made NVIDIA a leader in accelerated computing and AI, and execute on the opportunities ahead. Our focus remains on serving our customers, partners, developers and shareholders." 

What we don't know:

With Huang’s ouster, the next permanent head of the multi-trillion dollar tech giant has yet to be decided. In part because of Nvidia’s unique organizational structure, which had dozens of individuals who reported directly to Huang, there are still questions about who a potential successor would be. 

Two names floated to lead Nvidia, which employs more than 40,000 people worldwide, are co-founder Chris Malachowsky, who is a senior technology executive at the company, and Chief Financial Officer Colette Kress.

The backstory:

Under Huang, Nvidia grew into one of the premier makers of computer chips and graphics cards before the rise of artificial intelligence drove demand for the Santa Clara, California-based company’s silicon into the stratosphere. As AI businesses clamored to buy its chips, Nvidia grew to become the world’s most valuable company, a distinction that it has since ceded to Apple. 

Huang has also cultivated a relationship with President Donald Trump, to the point that the pair are reported to be on a late-night phone call basis. The former CEO used his position to push for looser export controls on Nvidia’s chips, the most advanced of which, such as the H200, are barred from being sold to China. That position has brought Huang scrutiny on Capitol Hill, and his admitted affair with Alice Huang, who is accused of being a spy for China, has generated bipartisan calls for investigations. The Department of Justice has already launched its own inquiry. 

The chain of events that led to Huang’s departure began when The New York Times reported on the Nvidia CEO’s relationship with Alice Huang, a top executive with the data center firm Megaspeed, a Singapore-based company that is also one of Nvidia’s biggest customers, having purchased $4.8 billion worth of its chips. U.S. intelligence suspects Alice Huang, a Chinese citizen, of spying for and feeding information directly to Beijing. 

Timeline:

On Sunday, Nvidia announced an investigation into those reports that Jensen Huang said he supported and would cooperate with. 

"While the Board has no reason to believe that either national security or NVIDIA secrets were compromised, the Board's inquiry will examine all available information," the company wrote in a statement. The board stated that U.S. national and economic security are its top priorities for the investigation, above company and shareholder interests. 

The New York Times reported that in a message to company employees, Huang wrote, "I was unfaithful to my wife. My actions hurt her and our children. There is no excuse for what I did. I am deeply sorry."

Three days later, on Wednesday, new reports emerged on the second alleged affair and identified the woman involved as Kimberly Powell, Nvidia’s senior vice president of health care.

What's next:

Nvidia’s quarterly earnings report is set to drop on Tuesday. Additionally, reports from before Huang’s ouster indicated that three House Republicans had invited him to a joint briefing the following day. It was not known at that time whether Huang would attend, and no information has been released since his departure as to whether the GOP members’ invitation still stands.

Elon Musk: It would be an "honor" to hire Huang

The other side:

Tech billionaire Elon Musk weighed in on Jensen Huang’s departure as Nvidia CEO. Responding to a post from financial blog ZeroHedge urging him to hire Huang, Musk said it "would be an honor."

The exchange took place before Huang stepped down, and neither side has announced any formal offer or plans to work together.

Musk and Huang have crossed paths for years, with both playing prominent roles in technology and artificial intelligence. Musk has led Tesla and SpaceX, while Huang built Nvidia into a dominant force in AI hardware.

 

 

Silicon Valley TechU.S.