Scandal-ridden Jensen Huang resigns, sending AI chip giant Nvidia into turmoil

Jensen Huang suddenly resigned as CEO of AI chip manufacturing giant Nvidia after being exposed as having an extramarital affair. The stunning fall sent shockwaves from Silicon Valley to Capitol Hill.

U.S. lawmakers in Washington, D.C., are scrutinizing Nvidia and demanding that Jen-Hsun Huang explain whether one of the subjects of his alleged extramarital affair was a Chinese spy.

Nvidia, which became one of the world's most valuable companies thanks to the AI ​​boom, wiped $550bn (£415bn) off its stock market value in just five days as the scandal dominated headlines.

Nvidia's interim CEO Colette Kress called an emergency meeting of the management team to discuss the company's future.

Huang's alleged behavior not only may have crossed professional boundaries, but also exposed Nvidia to questions from U.S. politicians who expressed concerns about national security risks.

Jensen Huang, who has been Nvidia's public face since 1993, admitted to being "unfaithful" to his wife on Sunday after it was reported that he had an extramarital affair with Alice Huang, who is suspected of spying for China.

On Wednesday, reports surfaced that he was having a second extramarital affair, this time with an Nvidia executive.

Alice Huang once served as an executive at Singaporean company Megaspeed and is not related to Huang Jen-Hsun. According to The New York Times, she is suspected of providing assistance to Chinese intelligence agencies. China denies the accusation, calling it a smear campaign.

U.S. Attorney General Todd Blanche said Thursday that the Justice Department has not reached any conclusion on whether Alice Huang spied for Beijing.

Senators Elizabeth Warren and Chris Coons, as well as other Democratic Party members on the House Foreign Affairs Committee, publicly asked Huang to explain the matter to Congress.

A Senate staffer told the BBC that if Huang refuses to voluntarily appear at any committee hearing where he is required to appear, he may receive a subpoena.

Nvidia has repeatedly declined to comment since Wednesday. A personal representative for Huang also declined to comment Thursday.

According to US media reports, Huang Renxun’s second alleged extramarital affair was with Kimberly Powell, a long-term executive at Nvidia. She reported directly to Huang Renxun within the company.

Sources told the BBC that Nvidia employees had noticed an unusually close relationship between the two.

After the first extramarital affair came to light, Huang was widely expected to weather the storm, even though Nvidia had announced an investigation at the time to determine whether its CEO "had been the target of foreign intelligence activities."

A current Nvidia employee told the BBC that initial reports of his infidelity were largely dismissed by rank-and-file employees.

The employee said that it was not until news of Huang’s alleged extramarital affair with an Nvidia executive came to light that employees began to think “this is crazy.”

Another Nvidia employee said they have been told not to talk to the media or otherwise comment publicly on the matter.

As Nvidia's stock price soared, many employees were able to sell their company stock and cash out, earning millions in compensation.

Nvidia said it had "no reason to believe that national security was compromised or that Nvidia's secrets were compromised," but promised that its independent investigation would review all available information.

Huang Renxun led Nvidia to rise rapidly and became an important promoter of the artificial intelligence industry. The industry relies on high-performance computer chips made by Nvidia.

These chips were originally designed for computer games.

But over the past four years, as artificial intelligence technology has developed chatbots and large language models, companies developing artificial intelligence tools suddenly need large quantities of Nvidia computer chips capable of processing huge amounts of data.

Nvidia is currently looking for someone to officially succeed Huang. Chief Financial Officer Colette Kress was named interim CEO on Thursday.

Several technology insiders interviewed by the BBC this week noted that Huang's loss has become a hot topic in San Francisco Bay Area circles. The area is home to a large number of tech workers, industry executives and billionaires.

He is far from the first tech giant to find himself in trouble after revelations of infidelity.

Microsoft's Bill Gates and Amazon's Jeff Bezos were both revealed to have had extramarital affairs in the past decade. Both are now divorced from their wives.

Jen-Hsun Huang and his wife Lori Huang have been married for 40 years. Both of their children also serve as executives at Nvidia.

Nvidia's stock price drop this week was the largest five-day drop since the company went public 27 years ago.