Nvidia board considers removal of CEO Jensen Huang amid personal scandal

Nvidia's board convened on Wednesday to evaluate whether to dismiss CEO Jensen Huang, according to a source familiar with the matter. The meeting follows reports that Huang was involved in two extramarital relationships, one with a businesswoman identified as Alice Huang, who U.S. intelligence has alleged is linked to Chinese espionage, and another with company executive Kimberly Powell.

Under Nvidia's bylaws, a majority of the 11 directors can remove Huang "with or without cause." The company has not responded to requests for comment, and the board had expressed confidence in Huang only days earlier.

The Wall Street Journal first reported that the board was preparing to fire Huang, and Nvidia's shares fell about 7 percent in early Frankfurt trading, erasing roughly US$600 billion in market value. Analysts at Minotaur Capital, Bernstein, Oppenheimer and Citi noted that a leadership transition would create uncertainty for the stock, given Huang's central role in strategy and investor confidence.

Bloomberg reported that the board is working with an outside firm to identify potential replacements, and a prediction market showed an 88 percent chance that Huang would leave the company by year-end, with CFO Colette Kress mentioned as a possible interim chief executive.

The leadership issue arises just before Nvidia is scheduled to release its quarterly results on Nov 17. In a memo to employees on Sunday, Huang admitted to an affair and said he took "full responsibility," without providing further details.

"The market is starting to price Nvidia without its founder as the likely outcome, not a tail risk," said Armina Rosenberg, portfolio manager and co-founder of Minotaur Capital, which holds Nvidia shares.

"A leadership transition creates an overhang on the stock given his central role in strategy, product vision, customer relationships, and investor confidence," Citi analysts wrote.

U.S. President Donald Trump said he spoke with Huang on Monday; Huang reportedly told the president he was unaware that the woman linked to him was alleged to be a spy. Huang could face a congressional subpoena if he does not comply with a request for a closed-door briefing on the allegations.

The news also affected broader market sentiment, with Nasdaq futures down 1 percent and rival chipmakers AMD and Broadcom posting gains, while Asian peers such as Samsung Electronics rose modestly and SK Hynix fell.