Nvidia's board is preparing to remove chief executive Jensen Huang following two extramarital relationships, one of them with a woman suspected of being a Chinese spy, the Wall Street Journal reported on Wednesday, citing people familiar with the matter.
The directors were said to be meeting as early as Wednesday to decide his fate.
What Triggered The Crisis
The controversy began with revelations about Huang's links to Alice Huang, who US intelligence has reportedly said helped facilitate shipments of Nvidia chips to Chinese firms. On Sunday, Huang told staff in a memo that he had been unfaithful to his wife and accepted "full responsibility", without elaborating.
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The board then opened an investigation into whether he had been targeted by a foreign intelligence operation. Independent directors are overseeing the inquiry with outside legal counsel. The board had initially expressed confidence in him.
Second Relationship Reported
Earlier on Wednesday, the New York Times reported that Huang also had an affair with Kimberly Powell, Nvidia's vice president of healthcare, citing five people who had worked at the company.
Asked about it by phone, Huang reportedly told the newspaper he did not think it should be speaking to him directly, and ended the call. Powell did not respond to requests for comment.
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Succession Questions
Analysts say an abrupt exit would be difficult. Gil Luria, head of technology research at D.A. Davidson, noted that Nvidia has no formal succession plan, and said the board is likely to act only once it has firm proof that Huang broke the law or company policy.
Political Attention
US President Donald Trump said he had not discussed the allegations with Huang, but backed him, describing him as an honourable man who has done a great job for the country.
Huang also faces a possible congressional subpoena if he declines a request for a closed-door briefing on his ties to the Chinese businesswoman, who is alleged to have passed information to Beijing.
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Market Reaction
Nvidia shares fell about 8% in after-hours trading on the news. According to Reuters, the chipmaker has lost roughly $600 billion in market value this week since the board announced its probe. The company is valued at around $4 trillion.
Why It Matters
Huang co-founded Nvidia in 1993 with Curtis Priem and Chris Malachowsky. The company began with graphics chips for gaming, and its CUDA software later opened its processors to general computing and then artificial intelligence.
Nvidia is now the dominant supplier of AI chips, placing it at the centre of both the global AI boom and the US-China technology rivalry.
His departure would leave a leadership vacuum at one of the world's most valuable companies, and revive concerns about firms that depend heavily on a single leader.
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