The key facts

  • Nvidia's board of directors could meet as soon as Wednesday, November 11, to decide the fate of CEO Jensen Huang — WSJ citing sources
  • Huang admitted to an extramarital affair with a woman whom US intelligence considers a suspected Chinese spy; NYT reported a second affair — with Nvidia vice president Kimberly Powell
  • Nvidia shares fell about 8% in after-hours trading and around 11% over five days; the board is examining whether Huang became the target of a foreign intelligence operation

Board prepares to remove

Nvidia's board of directors could remove the company's founder and CEO Jensen Huang within hours, who has led it for 33 years. The Wall Street Journal reported this citing sources; its data was quoted by Gazeta.Ru, TechCrunch and Anadolu. According to the outlet's sources, the board could meet as soon as Wednesday, November 11, US East Coast time, to decide Huang's future.

What is known about the scandal

On Sunday, Huang admitted to an extramarital affair with a woman whom, according to US intelligence, is believed to be a suspected Chinese spy. He apologized to employees, the board of directors and shareholders, promising to work to regain their trust; the executive's open letter was published on the company's website. On Wednesday evening, The New York Times reported, citing five former employees of the company, on a second affair of Huang's — with Kimberly Powell, Nvidia's vice president for healthcare. According to WSJ, the board of directors is examining whether Huang became the target of a foreign intelligence operation. Earlier, The Guardian wrote that Nvidia was accused of deceiving shareholders: in the shareholders' view, both parties concealed a relationship that raises national security concerns and threatens the company's reputation and business prospects.

Market reaction and the succession problem

Amid the scandal, Nvidia shares fell about 8% in after-hours trading on Wednesday, and around 11% over five days. Nvidia became one of the world's most valuable companies thanks to designing the chips that underpin the artificial intelligence boom, but, as TechCrunch notes, the company has no obvious successor or succession plan: Huang, by his own account, delegates very little and has about 60 direct reports. This makes a possible leadership change especially sensitive for a company whose value is largely tied to his persona. As of the time of writing, the board's decision has not been announced; the reports are based on anonymous WSJ sources.