Jensen Huang, an architect of the AI boom, resigns as Nvidia CEO
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Nvidia CEO Jensen Huang. Photo: Soeren Stache/picture alliance via Getty Images
Jensen Huang resigned as CEO of Nvidia after he reportedly had two affairs, including one with a purported Chinese spy.
Why it matters: It's impossible to overstate how critical Huang is to Nvidia, to the AI buildout, to the stock market and economy.
- His departure could, per Wall Street sources, be the catalyst that endangers a ballooning AI bubble.
- It's also unlikely to ease congressional scrutiny of the company or Huang himself.
Driving the news: Nvidia's board named longtime CFO Colette Kress interim CEO, while launching a search for a permanent replacement.
- Kress, who joined Nvidia in 2013, will continue serving as CFO while overseeing the company.
- Harvey C. Jones was appointed Nvidia's first-ever board chair.
- The board said it expects Nvidia's operations, customer commitments and product roadmap to continue without interruption.
What they're saying: "I believe deeply in this company and in its future. More than anything, I believe in each of you, in our customers and partners and in the vital role we play every day in the global economy," Kress said in a note to staff after the news came out.
- "We play a vital role in building the technology that is powering the AI revolution, and we have important work ahead of us. So let's move forward together, with the same determination and commitment that have always defined this company," she added.
Zoom out: Huang's resignation follows revelations about two extramarital relationships.
- The New York Times reported Wednesday that Huang had a relationship with Kimberly Powell, a senior Nvidia executive who reports to him.
- Nvidia's board had previously launched an independent investigation into Huang's relationship with Alice Huang, a Chinese businesswoman identified by U.S. intelligence as a Chinese intelligence asset.
- Nvidia did not provide a reason for Huang's resignation in Thursday's announcement, which comes after reports that the board had an emergency meeting over whether to oust the CEO.
By the numbers: Nvidia shares fell as much as 13% after news of Huang's resignation before rebounding somewhat.
- One of Wall Street's most prominent voices on tech, analyst Dan Ives, said Nvidia was worth 25% less without Huang.
🚨 Stunning stat: At these levels, Nvidia will have lost about $1.4 trillion in market capitalization in two weeks, since the initial Times report about linking Jensen Huang and Alice Huang.
The big picture: This will likely go down as one of the biggest executive scandals in history.
- Nvidia is also one of the largest holdings in major index funds because of its size, meaning this move has massive implications for every American with a retirement account.
The intrigue: Huang's resignation doesn't look like it'll ease congressional pressure over his behavior either.
- "NVIDIA CEO Jensen Huang's decision to resign does not absolve him, other executives, or the company as a whole of responsibility for putting our national security at risk or for any potential violations of our laws," Sen. Elizabeth Warren (D-Mass.) said in a statement.
The bottom line: The fallout is just starting.
This is breaking news.
