The board of directors of technology firm Nvidia met on Wednesday to decide on the removal of chief executive Jensen Huang, Reuters has learned. The company is the world's leading manufacturer of artificial intelligence chips, with a market value estimated at around four trillion dollars.
Under company rules, Huang can be removed by a majority vote of the board members, regardless of whether there is a specific reason for doing so. Nvidia has 11 board members, all of whom are considered independent except for Huang. Nvidia shares fell more than eight per cent in extended trading after the Wall Street Journal first reported that the company was preparing to oust Huang. If such a drop is sustained, Nvidia's market value would decrease by approximately 600 billion dollars.
The board launched an investigation into his relationship with businesswoman Alice Huang, who is suspected of being a Chinese spy who facilitated the delivery of Nvidia chips to Chinese companies. Huang, according to a source familiar with the case, had two extramarital affairs, one with the woman suspected of being a Chinese spy. On Sunday, Nvidia's board expressed confidence in Huang and his management team, while launching an investigation on the same day into whether Huang had been the target of a foreign intelligence operation.
The New York Times reported earlier on Wednesday that Huang also had an extramarital affair with a company executive who reported directly to him - Kimberly Powell, Nvidia's vice-president for the healthcare sector, citing five people who had worked at the company. When the New York Times telephoned Huang on Wednesday to ask about his relationship with Powell, he replied: "I think you should not be speaking to me directly", before hanging up, the newspaper reported, though Reuters was unable to independently verify these claims. In a letter to employees on Sunday, Huang admitted to being unfaithful to his wife and accepted "full responsibility", but did not provide details about that relationship.
Bloomberg reported on Wednesday, citing a person familiar with the situation, that Nvidia's board is working with an external firm to identify potential successors for Huang. Huang has no obvious successor and holds 3.6 per cent of the company's shares. He co-founded Nvidia 30 years ago with Curtis Priem and Chris Malachowsky and developed it into the leading supplier of chips at the centre of the global artificial intelligence boom and the technological rivalry between the US and China. Huang's potential departure would leave a vacuum at the head of the chipmaker.
US President Donald Trump stated that he had not discussed the allegations with Huang, but expressed support for the Nvidia chief, calling him an "honourable man" who had "done an incredible job for our country". Huang faces the possibility of a congressional subpoena if he does not respond to a request for a closed-door briefing on claims that he was closely linked to a Chinese businesswoman who passed information to Beijing.
