Nvidia working with outside firm to identify CEO candidates

• Nvidia’s board is using an outside firm to find possible replacements for CEO Jensen Huang after reports of multiple affairs and a possible spying link.
• Directors are considering a temporary chief, while the company faces pressure from investors, staff and lawmakers over trade secrets and succession planning.
• The crisis hit Nvidia’s share price, which fell 8% after reports, and raised wider concerns because Huang has led the firm through its huge rise in value.

Nvidia’s board has been working with an outside firm to identify potential replacements for chief executive Jensen Huang following reports of multiple extramarital affairs, including one with a woman who is reportedly suspected of spying for China, a person familiar with the situation said.

The board is weighing the idea of naming a temporary chief while searching for a permanent one, the person said, asking not to be identified because the information is not public.

Directors were meeting on Nov 11 to discuss Huang’s fate, according to people familiar with the situation.

The Wall Street Journal said earlier that the board was preparing to oust Huang, citing unidentified people familiar with the matter.

Nvidia did not immediately respond to a request for comment.

Nvidia’s board has been facing a succession crisis since Nov 8 when Huang admitted that he had an affair with Alice Huang, a data centre executive at a company that is one of Nvidia’s largest South-east Asian customers.

The New York Times has reported that Alice Huang was suspected of operating as an agent on behalf of the Chinese government. 

The crisis escalated late on Nov 11, when the Times reported that Jensen Huang also had a relationship with Kimberly Powell, Nvidia’s vice-president of healthcare, citing unidentified people who worked at the company.

Powell did not immediately respond to a request for comment.

The disclosure and subsequent reports have left the board with a difficult option: ousting the founder and only person to have run Nvidia, firing an executive who – at least until recently – had commanded widespread respect of shareholders and customers alike, and who had overseen a surge of more than 700,000% in the company’s share price. 

But keeping Jensen Huang in the role would likely subject Nvidia to a barrage of scrutiny from lawmakers, investors, customers and staff concerned over his relationship with Alice Huang and whether it put Nvidia’s trade secrets at risk – as well as his extramarital relationship with a person who directly reported to him at the company.

The developments have also shined a light on Nvidia’s lack of a succession plan for Huang, and reinforced how inseparable the 63-year-old CEO is from the company and its success.

His potential exit would reverberate far beyond the company’s operations, and not just because Nvidia is the dominant maker of chips at the heart of the AI boom. 

Huang is a consummate dealmaker and has used the company’s vast resources to invest in the AI supply chain and a variety of start-ups.

He is also a top evangelist for the AI revolution itself, downplaying fears about the risks to humanity and talking up the benefits.

The company’s stock dropped 8% in extended trading following the reports on Nov 11.

Alice Huang was an executive at Megaspeed International, a Singapore-based firm that was spun out of a Chinese gaming enterprise.

That company has been under US investigation for months related to potential chip smuggling, Bloomberg has reported.

Megaspeed and Nvidia have denied wrongdoing, and Beijing has dismissed allegations that it spied on Jensen Huang. BLOOMBERG