Huang Renxun is deeply involved in extramarital affairs. (File photo, AFP)
[Financial Channel/Comprehensive Report] NVIDIA CEO Jen-Hsun Huang is involved in an extramarital affair. The alleged partner is suspected to be Chinese female spy Huang Le (also known as Alice Huang), which has triggered US national security concerns. Not only has Huang Renxun's personal reputation been affected, but the outside world has begun to pay attention to how Huida's future will develop if he is forced to leave the position of CEO due to the results of the investigation. The real challenge may lie in whether the successor can continue Huang Renxun's strategic vision and his ability to judge the future trend of the AI industry.
"CNN" pointed out that Huang Renxun has been at the helm of Huida for 33 years and has long been inseparable from the company's strategy, corporate culture and global technology industry layout. Huang Jen-Hsun has admitted in the past that he never believed in the succession plan. However, this turmoil may force him to face a question: Without Huang Renxun, can Huida continue to maintain its current industrial status?
Huang Renxun has now admitted to extramarital affairs, and Huida's board of directors announced that it will launch an investigation into relevant reports. Multiple U.S. media pointed out that U.S. officials suspected that Huang Le had provided intelligence to China and helped smuggle advanced AI chips into China. The investigation has just begun, Huang Renxun's future is still unclear, and Huida's future is also full of variables.
This turmoil also reacted to the investment market. Investors began to worry about the future of Huida and the impact of Huang Renxun's possible resignation. Huida's share price plummeted on Monday.
What will happen to Huida if Huang Jensen no longer serves as CEO?
Ken Mahoney, CEO of Mahoney Asset Management, pointed out that Huang Renxun has a great influence on Huida's business strategy, corporate culture, and relationships with large technology companies. Once this leader is lost, it will inevitably bring a high degree of uncertainty to the company.
He said, "If this happens (Huang Renxun resigns), the situation of Huida's stock price will be even more difficult than it is now. He is an extremely important figure for the development of the technology industry and AI infrastructure."
However, he also pointed out that Huida's competitive advantage is not entirely based on a single person. There are still enough management talents within the company. The situation is just like Apple, even if it loses Steve Jobs, it can still continue to develop.
Some analysts also believe that even if Huang Renxun really leaves, Huida's business will not collapse immediately. "The real challenge is whether the successor can continue Huang Jen-Hsun's strategic vision and his ability to judge the future trends of the AI industry."
Morningstar senior equity analyst Brian Colello also believes that large companies that mainly purchase Huida chips and software are unlikely to immediately significantly reduce capital expenditures on AI training and data centers because of uncertainty about the CEO position.
However, he reminded that Huang Renxun has always been an important figure in promoting investment in AI infrastructure, not only driving industrial demand, but also assisting other companies to obtain funds and purchase Huida chips. If the most influential CEO in the AI industry no longer leads related transactions, the cost of funding for AI investments in the future may also rise.
Fear of shareholder lawsuits
Today, boards must strike a balance between thoroughly investigating incidents and maintaining corporate stability. Shareholders may also sue for breach of fiduciary duty, but it may be more difficult to provide sufficient evidence for such lawsuits.
Kathy Harrigan, a professor at Columbia Business School, believes that the board of directors has the responsibility to fully investigate the relevant allegations. If it is confirmed that Huang Renxun has leaked company secrets, he should be considered for removal. She also pointed out that a competent board of directors should prepare at least two successor candidates, or clearly understand what kind of talents should be recruited from outside if necessary, so as to ensure that the company will not be shut down due to the sudden departure of the leader.
In addition, Huida may also face the risk of shareholder litigation. Ann Lipton, a professor at the University of Colorado School of Law, pointed out that Huida has previously downplayed the relationship between Huang Renxun and Megaspeed. If shareholders can prove that the company or Huang Renxun has deliberately made misrepresentations about events and related risks, they may file a lawsuit seeking compensation for losses caused by the decline in stock prices. She believes that Huida currently faces serious shareholder litigation risks.
