Jensen Huang Resigns as Nvidia’s Valuation Plunges
On November 12, Jensen Huang resigned as chief executive of Nvidia, the chipmaker he founded 33 years ago. The announcement came amid a company investigation into his conduct and weeks of turmoil over reported relationships with a former executive at Singapore-based chip buyer Megaspeed, who has been characterized as a suspected operative linked to China’s state security agency. Huang and the former executive are not known to be related.
Nvidia shares lost about $546 billion in market value within an hour of the resignation announcement. The company’s valuation had fallen by more than $1 trillion since the scandal began in late October, when Huang’s relationship with the former executive was reported. Nvidia announced its investigation on November 8, after Huang acknowledged an affair.
Huang’s personal fortune was estimated at $143.3 billion on November 12, down from $154 billion in recent days. He owns more than 3.5 percent of Nvidia, largely in shares held outright. His departure means he will forfeit about $108 million in unvested equity compensation and lose his annual salary, which amounted to about $7.5 million per year over the previous two years.
Huang has committed to being questioned privately by three House committees ahead of Congress’s Thanksgiving recess. Nvidia may also face congressional scrutiny. The company’s shares fell as rival chipmakers gained, with AMD up 28 percent and Broadcom nearly 16 percent over five days.
A crisis communications expert said Nvidia was unlikely to try to take Huang’s shares, but his possible sale of them could unsettle investors. Huang’s stock holdings account for most of his wealth; the future of those shares remains a central concern for the company and its shareholders.
Nvidia’s China Ties Demand Answers After Huang’s Exit
Nvidia’s collapse after Jensen Huang’s resignation underscores the stakes of a scandal involving a company central to the artificial intelligence industry and a former executive accused of ties to China’s Ministry of State Security. Huang left on November 12, after Nvidia opened an investigation into his conduct and he acknowledged an affair.
The reported relationship surfaced in late October. Since then, Nvidia has lost more than $1 trillion in market value, including roughly $546 billion in the hour after the resignation announcement. The company’s chips are used to train most major AI models, and Nvidia has invested billions in other technology companies.
Huang has agreed to answer questions behind closed doors from three House committees before the Thanksgiving recess. The acting chief executive may also be called before Congress. The scrutiny makes it important for lawmakers to examine the reported China connection and the company’s handling of the matter—not merely the financial fallout.
Huang’s estimated fortune fell from $154 billion to $143.3 billion in recent days, but most of it is tied to Nvidia shares he owns outright. He will give up about $108 million in unvested compensation and lose his annual salary, while the company is unlikely to seize his shares. Any sale could further unsettle investors.
Nvidia’s stock loss has coincided with gains for rivals AMD and Broadcom. What comes next for the company—and what Huang may tell lawmakers—will shape the consequences of a scandal that reaches beyond one executive’s departure.
Nvidia’s Collapse Puts China Questions and Corporate Judgment in Focus
Nvidia’s steep decline after Jensen Huang’s resignation is a warning about what happens when a company built around one powerful executive faces a scandal with national-security implications. The chipmaker announced Huang’s departure on November 12, after he acknowledged an affair and the company began investigating his conduct.
The controversy includes a reported relationship with a former executive at Singapore-based Megaspeed, who has been described as a suspected operative associated with China’s Ministry of State Security. Nvidia’s market value has fallen by more than $1 trillion since the story emerged in late October, including a roughly $546 billion loss shortly after Huang resigned.
Three House committees are set to question Huang behind closed doors before Congress’s Thanksgiving recess. The company may also face congressional scrutiny. Those hearings should focus on the facts surrounding the reported China connection and the company’s response, rather than treating Nvidia’s importance to the technology sector as a reason to avoid hard questions.
Huang’s estimated fortune fell about $11 billion in recent days, to $143.3 billion. He will forfeit $108 million in unvested compensation and lose his salary, but most of his wealth is in Nvidia shares he owns outright. The company is unlikely to take those shares; a large sale could put further pressure on investors.
Meanwhile, Nvidia’s competitors have benefited, with AMD up 28 percent and Broadcom nearly 16 percent over five days. The market reaction shows how much uncertainty now surrounds a company whose leadership and reputation were closely bound to Huang.
Reported by Wired, New York Post.
