San Francisco (United States) (AFP) – Jensen Huang, the leather-jacketed architect of the artificial intelligence boom, resigned as chief executive of Nvidia on Thursday after revelations of two extramarital affairs, including one with a woman accused of spying for China. The scandal has wiped almost half a trillion dollars off Nvidia’s market capitalisation, as it raises national security fears and leaves the AI industry in uncharted waters. Chief Financial Officer Colette Kress will serve as interim CEO while Nvidia’s board searches for a successor, ending Huang’s 33 years at the helm of the company he co-founded. Huang, 63, also gave up his board seat. Nvidia did not give a reason for his departure.
Huang was a central figure in the boom set off by the launch of OpenAI’s ChatGPT in 2022, with Nvidia’s processors, once designed for video game graphics, becoming the crucial ingredient for building AI models. He was also a close informal adviser to President Donald Trump on AI and had spent years lobbying against curbs on sales of advanced AI chips to China. Nvidia shares fell as much as 13 percent following the announcement before paring losses to about four percent, wiping roughly $450 billion off the company’s value since the weekend. Dan Ives of investment bank Yorkville Ives called it “a dark day for Nvidia and the US tech industry,” but said the board had done what it needed to: “rip off the band-aid and take Nvidia into its next chapter without him.” The board named Harvey Jones, a former chief executive of chip design software firm Synopsys, as chair, and said it expected the company’s operations and product roadmap “to continue without interruption.”
Interim CEO Kress joined Nvidia in 2013 after nearly 25 years at companies including Cisco and Microsoft. Trump, who had stood by Huang throughout the scandal, said former Apple boss Tim Cook should take over. “A Legend replaces a Legend!” Trump said on his Truth Social network. “Tim Cook took a lot of these brilliant ideas and designs and everything else from Jobs and others, and he made it into one of the great companies of the world at a fairly short range. I think Tim Cook would be a great candidate to run Nvidia,” wrote the president. Huang remains Nvidia’s largest individual shareholder, with a stake of about 3.6 percent, according to the company’s most recent filing. For many in Silicon Valley, the departure recalls that of Steve Jobs, who was pushed out of Apple by its board in 1985 and returned 12 years later to take the company to new heights.
– Two alleged affairs – Huang, who has been married to his wife Lori for more than 40 years, admitted on Sunday to an affair, reportedly with Alice Huang, a former senior executive at Singapore-based data center company Megaspeed. The two are not related. US intelligence reportedly circulated a memo this spring alleging she was an asset of China’s Ministry of State Security. Beijing has rejected the allegations. Singapore said Thursday it had barred Alice Huang, a Chinese national, from re-entering the country in February for giving investigators inaccurate information about her role at Megaspeed, though she was not investigated for espionage. Nvidia’s board opened a probe on Sunday into reporting that Huang had been the target of a “foreign intelligence effort,” while saying it retained confidence in him.
When asked Thursday if Jensen should have stepped down, Trump said it depended on whether the woman was indeed a Chinese spy. “If the woman was a spy, yes. If the woman was not a spy, perhaps it would be different,” Trump said in an interview with sports commentator Stephen A. Smith. But Trump said he was confident that Huang will “end up on his feet.” “I spoke to him yesterday. He’s going through hell. What he feels most badly about is his wife and family,” the president said. On Wednesday, The New York Times reported a second affair, citing video of Huang being affectionate with Nvidia’s vice president of health care, Kimberly Powell.
– US-China tech race – At the heart of the spy allegations is the race between the United States and China for supremacy in an industry widely seen as the next industrial revolution. Key US lawmakers, including Senate Democratic leader Chuck Schumer, called Thursday for answers on what the Trump administration knew about Huang’s ties to a suspected Chinese intelligence asset, days before Trump travels to China for a summit. Reports allege the Commerce Department under Secretary Howard Lutnick may have failed to act on suspicions that Megaspeed was helping reroute restricted Nvidia technology to China. Singapore’s home ministry said it had repeatedly sought information from the US Justice Department and FBI on a US server supplier during its Megaspeed probe, but “received limited information or assistance.”
© 2024 AFP
