- Nvidia shares fell 7.34% to $160.99 after CEO Jensen Huang resigned amid scandal
- Jensen Huang admitted infidelity and confirmed an investigation on security concerns
- Colette Kress was named interim CEO; Harvey C. Jones appointed first board chairman
Shares of Nvidia steadied its decline to trade at a downturn of 7.34% to $ 160.99. It plunged 14.24% after the opening bell on Thursday, amid the announcement of chief executive officer (CEO) Jensen Huang's resignation. The AI chip company named chief financial officer Colette Kress as the interim CEO.
Huang's resignation and the continued downturn of the firm's stock follows the reports of his affiar with Alice Huang, an alleged to be a spy for the Chinese government as per US authorities, with Jensen Huang confirming the infidelity.
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He added that the firm would undertake an independent investigation to determine wether US national security or the company's confidential information had been compromised.
" 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.....Regarding the national security concerns raised in news reports, NVIDIA's Board of Directors has initiated an independent investigation. I support the investigation and will cooperate fully. I love our country and our company. I am committed to protecting NVIDIA and supporting America's national security. I am proud and grateful to be an American," he wrote in an e-mail.
The board has initiated the search for a permanent Chief Executive Officer and will evaluate both internal and external candidates, the chipmaker said in a statement on Thursday.
The company also appointed Harvey C. Jones as its first-ever Chairman of the Board. Jones brings more than three decades of experience as an entrepreneur, technology executive and venture investor, and previously served as CEO and Executive Chairman of Synopsys.
Colette has helped lead NVIDIA through a period of extraordinary growth and has a deep understanding of our business, customers, operations and financial position,” Jones said. He added that the board expects operations, customer commitments and the product roadmap “to continue without interruption.”
ALSO READ: Nvidia Hit By Seven Downgrades In 24 Hours As Jensen Huang's Exit Rattles Wall Street
Wall Street's sentiment toward Nvidia Corp. deteriorated rapidly. Between Wednesday and Thursday morning, seven brokerages downgraded the stock as concerns mounted over the company's leadership situation.
Baird, Oppenheimer, Bernstein, Evercore ISI, William Blair, KeyBanc Capital Markets and Melius Research all removed Nvidia from their buy-equivalent recommendations, with several firms slashing their price targets by roughly half. Meanwhile, Cantor Fitzgerald, BMO Capital Markets, Citi, Stifel and RBC Capital Markets maintained their bullish ratings on the stock but sharply lowered their target prices.
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