Nvidia Board Weighs Huang's Future After Second Affair Allegation and Spy Scandal

Nvidia's board of directors met Wednesday evening to decide the fate of founder and chief executive Jensen Huang, three days after he admitted to an extramarital affair and hours after The New York Times reported a second relationship with a direct report. The meeting follows a week in which the company lost more than $300 billion in market value and US intelligence officials told CNN they believe a woman romantically linked to Huang was a Chinese intelligence operative [1].

Two affairs, one investigation

Huang apologised to employees on Sunday for an affair he did not name. US intelligence officials told CNN the other party was Alice Huang (no relation), a 43-year-old Chinese citizen and former executive at Megaspeed, a Singapore-based Nvidia customer under investigation for allegedly diverting advanced chips to China [1]. Beijing called the espionage claim "purely groundless speculation" [1]. Singapore's Ministry of Home Affairs said it had not investigated Alice Huang, though it confirmed investigations into Megaspeed for fraud on server suppliers are ongoing [4].

On Wednesday, The New York Times reported Huang also had a relationship with Kimberly Powell, Nvidia's vice-president of healthcare, who has worked at the company for more than 18 years [2][3]. Asked about the report, Huang told the paper, "I don't think you should be talking to me directly," and ended the call [2]. Nvidia's code of conduct, which applies to the CEO, states managers play a "special role" in "promoting equitable and ethical decisions, and fostering safe work environments" and that violations can lead to termination [1].

Board under pressure

The 11-member board, which has no board chair and includes four directors who have known Huang since the 1990s, retained Wachtell, Lipton, Rosen & Katz to lead the investigation into whether Huang was the target of a foreign intelligence operation [1]. The firm assigned a former federal prosecutor to run that probe [3]. Reuters reported the long-standing ties have raised questions about the board's objectivity [1].

Democratic senators Elizabeth Warren and Chris Coons wrote to Commerce Secretary Howard Lutnick, Secretary of State Marco Rubio and White House Chief of Staff Stephen Miller demanding preservation of documents regarding the export of NVIDIA's advanced AI chips to China or to entities that may divert such chips to China, and a congressional briefing on national-security risks [1].

President Trump, who travelled with Huang to Beijing in May, said Monday he had spoken with the CEO [1]. Trump also said the FBI was investigating the situation and called Huang "a high-quality person" [3]. On Sunday, asked whether he would bring Huang on next week's trip to Shenzhen for the APEC summit, Trump said, "I don't know, but I'd certainly take him" [1]. A source told CNN that Rubio briefed Trump on the intelligence about Alice Huang before that May trip; Trump denied knowing at the time [1].

No succession plan

Huang has long dismissed succession planning. In a podcast earlier this year he said it's not because he thinks he's "immortal" but because he believes the best way to handle such concerns is to prepare everyone at the company [1]. Nvidia's proxy statement mentions succession planning once, in a risk disclosure noting the company is "highly dependent on the services of our longstanding executive team" [1]. By contrast, Apple and Google reference it roughly a dozen times each [1].

Analysts are divided. Dan Ives of Yorkville Ives & Co. wrote that "the writing is on the wall" and valued Nvidia at $300 per share with Huang versus $225 without him [1]. Former SEC chair Gary Gensler told CNN the allegation that Huang had a second affair is likely to force the board of directors to oust the rockstar CEO [1]. Mike O'Rourke of JonesTrading said "Jensen's successor will not have the same latitude or deference to pursue circular deals and pursue aggressive sales tactics" [1]. Others noted Nvidia's chip technology and ecosystem remain entrenched; AMD and Broadcom shares rose 4.3% and 2.4% respectively [1].

What happens next

The board could leave Huang in place while the investigation proceeds, install an interim chief, or push for his immediate departure. Bloomberg reported the board is working with an outside firm to identify successors [2]. A shareholder class action filed Monday alleges Huang and the company concealed the relationship and its risks [2].

Nvidia's chips remain the backbone of the AI infrastructure boom [1]. The company's equity investments and complex financial guarantees have made it a central financier of AI start-ups [3]. Whether that structure survives a leadership change — and whether US-China chip policy shifts with Huang's exit — are open questions the board must weigh before announcing its decision.