Less than a day after the board of chip-maker Nvidia was said to be mulling the removal of CEO Jensen Huang, Huang has resigned from the company, and its stock price has taken a hit.
Nvidia's board of directors announced early Thursday that Huang had resigned, "effective immediately," following a new report Wednesday that he had conducted a second extramarital affair, this time with a direct report.
The company's CFO and current Executive Vice President Colette Kress has taken over as interim CEO, and will do both jobs until a new CEO can be found. Kress has served in her current role since joining the company in 2013.
"Nvidia’s strength has always come from its people, and together with our leadership team, I am committed to building on the extraordinary foundation Jensen created over the last 33 years," Kress said in a statement. "We will continue advancing the work that has made Nvidia a leader in accelerated computing and AI, and execute on the opportunities ahead. Our focus remains on serving our customers, partners, developers and shareholders."
Also Wednesday night, the board voted to elect its first-ever chairperson, and that is now venture capitalist Harvey C. Jones, who was formerly CEO of Synopsys. Jones said in a statement that the board has "full confidence" in Kress and the leadership team to continue operations at Nvidia without interruption.
"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.
Wall Street seems weary of the transition, and Nvidia's stock price was down over 9% in early trading. As of noon Eastern Time, the stock price had recovered slightly, and was trading at $164.43, down 5.33%. As CBS News notes, this comes after the share price had already lost 9.6% of its value in trading on Monday and Tuesday, following the weekend's report of Huang's affair two years ago with a known Chinese spy.
Nvidia shares were trading at around $228 just a month ago, marking a major loss in valuation. Despite the tumble, the company remains, as of this moment, the second-most valuable company in the world behind Apple, with a market cap of $3.97 trillion.
Ipek Ozkardeskaya, senior analyst at Swissquote, tells CBS News that while "there is no credible way to put a precise revenue loss" on Huang's departure, "Customers buy Nvidia's computing power, software and networking ecosystem, and those advantages wouldn't disappear with its CEO."
What is clear is that the AI era has seen its first major leadership shakeup — at least since that brief moment in 2023 when OpenAI's board tried to oust Sam Altman.
Following the revelation late last week that Huang had conducted some sort of romantic liaison with Chinese operative Alice Huang (no relation) — which may or may not have led him to convince President Trump to ease restrictions on AI chip sales to China — the New York Times reported Wednesday that Huang had also more recently been conducting an affair with Nvidia's vice president of health care, Kimberly Powell.
Huang has not acknowledged the Powell affair, but wrote a memo to company employees over the weekend apologizing for the Chinese spy affair, saying that he had betrayed his wife and children.
Previously: Nvidia May Be Preparing to Oust CEO Jensen Huang Following Report of Second Affair
