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The report from the WSJ comes hours after the New York Times revealed that Huang allegedly had an extramarital relationship with Kimberly Powell , Nvidia's vice president of health care, who reports directly to him. According to five people who worked at Nvidia, the relationship was known internally, while Huang and Powell were reportedly seen together at a San Jose hotel during Nvidia's GTC conference in March. The allegations follow an earlier report that Huang had a relationship with Alice Huang, a Chinese businesswoman whom U.S. intelligence believes to be a Chinese intelligence asset.
A similar controversy cost Intel chief executive Brian Krzanich his position in June 2018, when an internal investigation confirmed that he had maintained a consensual relationship with an employee, which violated the company's non-fraternization policy applicable to all managers. It is noteworthy that Nvidia's code of conduct explicitly identifies personal relationships as potential conflicts of interest and instructs employees to consult the company's legal department when such conflicts arise. Whether Huang violated Nvidia's internal policies remains unclear, as the code of conduct does not explicitly prohibit all relationships between managers and subordinates.
Huang's potential departure would mark the first CEO transition in Nvidia's 33-year history, and therefore his succession has become an immediate concern for Nvidia, which does not have anyone of Huang's caliber in the leadership team. Although chief financial officer Colette Kress could potentially serve as interim chief executive if Huang is ousted while the BoD searches for a permanent replacement, it remains to be seen how Wall Street would react to this assignment.
Nvidia co-founder Chris Malachowsky, who used to be the company's senior vice president of engineering and operations and remains a member of the company's board and an Nvidia Fellow, could also play a role in the succession process, given his extensive knowledge of Nvidia's technology, corporate culture, and history. However, has not served in an executive role at Nvidia for at least a decade, so the chances that he will succeed Huang are low.
Jensen Huang now accused of affair with Nvidia executive who reported to him, alleged cover-up attempt
Nvidia CEO Jensen Huang admits to having an affair with suspected Chinese spy
Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/pc-components/gpus/SPONSORED_LINK_URL
- https://www.tomshardware.com/pc-components/gpus/nvidias-board-reportedly-preparing-to-oust-ceo-jensen-huang-as-second-extra-marital-affair-emerges-stock-has-plunged-20-percent-since-scandals-began-huang-has-been-first-and-only-ceo-for-33-years#main
- https://futureplc.com/privacy-policy/
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Informational only. No financial advice. Do your own research.