Jensen Huang resigns as Nvidia’s chief executive, ending a 33-year run in which the founder turned a small graphics-chip company into the centre of the global artificial intelligence boom — and sending the company’s shares into a wild swing on Thursday.
Key Points
- Jensen Huang resigns — Nvidia said on Thursday that Huang had resigned as president, chief executive and a board member, effective immediately.
- Chief financial officer Colette Kress is interim chief executive, and longtime director Harvey C. Jones has become the board’s first-ever chair.
- Nvidia shares fell as much as 16% during the session to an intraday low near $148.80, before recovering to close at $166.19, down 4.3% on the day.
- The board accepted Huang’s resignation on 11 November and announced it on 12 November; the company reports third-quarter results on Tuesday, 17 November.
Huang, 63, co-founded Nvidia in 1993 and was its only chief executive. The company’s regulatory filing with the US Securities and Exchange Commission gives no reason for his departure, saying only that he had resigned from all three roles. The board is now searching for a permanent successor from internal and external candidates, and Kress will keep the chief financial officer’s job alongside the interim role.
The announcement followed days of turmoil. The Wall Street Journal reported on 11 November that Nvidia’s board was preparing to oust Huang and could meet as soon as that Wednesday to decide his future. On 8 November the board had opened an independent investigation after reports that Huang had been the target of a foreign intelligence effort, and Huang told employees in an email the same day that he had been unfaithful to his wife, without naming anyone.
Why Huang left
Nvidia has not said officially why Huang resigned, but the reports around his exit point in two directions. Fox Business reported that he stepped down after an internal investigation into his relationship with a woman reported to be a suspected Chinese spy, while other reporting has stressed that the intelligence collected so far does not prove she was acting as a spy for China. US officials believe Alice Huang, an executive at the company Megaspeed, is a Chinese intelligence asset; China denies it, and Huang reportedly denies knowing of any spying.
The political pressure is not over. The chairs of the House Foreign Affairs Committee, the House Select Committee on China and the House Intelligence Committee have asked Huang to sit for a closed-door, transcribed interview on 1 December, and gave him until 8 p.m. ET on Friday, 13 November to confirm in writing — or the Foreign Affairs Committee will issue a subpoena. Nvidia says it will continue its internal investigation even after his exit.
A wild day for the shares
The market reaction was severe at first and then steadied. Nvidia opened at $150.99 on Thursday, about 13% below Wednesday’s close of $173.73, and at one point traded near $148.80. Volume ran to about 737 million shares, roughly five times the three-month average. By the close, buyers had stepped in and the stock finished at $166.19, down 4.3%, with the company’s market value just above $4 trillion, down from about $4.5 trillion the previous Friday.
The shares have now lost more than 20% in November and about 30% since the 6 October close of $239.24. Rival chipmakers moved the other way on Thursday, with Broadcom rising about 5% and AMD up a few per cent. Nvidia says its operations, customer commitments and product roadmap continue without interruption, and the first real test of the new leadership comes on 17 November, when the company reports third-quarter results and holds its earnings call.
For background on the board’s move, see our report on Nvidia’s board weighing Jensen Huang’s future as shares slid, and on the blacklisted Chinese university that bought Nvidia H200 AI chips. More in our Business section.
Sources: AIF Intent, “Nvidia Falls 4.3% After Jensen Huang Resigns: What Investors Watch Before Nov 17 Earnings”; Cosanalyst, “Jensen Huang Resigns as Nvidia CEO: What It Means for NVDA Stock”.