4 minute read
The most valuable chip company on Earth woke up Thursday without the only chief executive it has ever known. Jensen Huang resigned as president and chief executive of Nvidia and gave up his seat on the board, effective immediately, ending a run that began when he helped found the company in 1993.
Colette Kress, the executive vice president and chief financial officer since 2013, will serve as interim chief executive while keeping her finance job. The board has started a search for a permanent successor and says it will consider candidates inside and outside the company. Harvey C. Jones, a director since 1993, was named the first chair of the board in company history.
Major Takeaways
- Jensen Huang resigned effective immediately as president, chief executive and board member after 33 years leading Nvidia.
- Chief financial officer Colette Kress is interim chief executive, and the board is searching for a permanent successor.
- Nvidia shares fell about 12 percent before the opening bell, and the company has lost roughly 600 billion dollars in market value this week.
- The exit follows a board investigation into whether Huang was the target of a foreign intelligence operation, and reporting that he admitted a relationship with a woman United States intelligence officials suspect of spying for China.
- The company reports quarterly earnings on Tuesday, November 17, the first big test of the new leadership.
In its announcement, the company gave no reason for the resignation. The board thanked Huang for what it called his immeasurable contributions to the company and the industry, and it said operations, customer commitments and the product roadmap will continue without interruption. The board accepted the resignation on Wednesday and announced it Thursday morning in a regulatory filing.
The departure closes a week that moved at stunning speed. On Sunday, November 8, the company said independent directors, helped by outside lawyers, would investigate whether Huang had been the target of a foreign intelligence operation. Reporting through the week tied the crisis to a relationship Huang admitted with a Singapore based technology executive whom United States intelligence officials suspect of working for Chinese intelligence, and to a second reported relationship with a senior Nvidia executive. By Wednesday night, the board was reported to be preparing to remove him.
Wall Street did not wait for the search to play out. Shares fell about 12 percent in trading before the opening bell on Thursday, to around 152 dollars, their lowest levels in more than a year, and the selling pulled the wider market down with it. Six firms downgraded the stock between Wednesday night and Thursday morning, and one leading analyst valued the company far lower per share without Huang at the top than with him.
This is not a story that stays on Wall Street. Nvidia sits inside the index funds held by ordinary savers across the country, and because it is one of the largest companies in the S&P 500, nearly every retirement account and pension fund in America holds a piece of it. When a company this size loses roughly 600 billion dollars in value in one week, the loss lands in the accounts of working people, including Black families who have spent years building savings that already started from behind, a gap Urban City Podcast has tracked in its coverage of the Black wealth gap. It lands the same week a separate fight in Washington put food assistance at risk for millions of families.
Kress, who is 59, has run Nvidia finances for more than a decade and knows where every dollar in the building sits. Her first test comes fast. The company reports third quarter results on Tuesday, November 17, at about 1:20 in the afternoon Pacific time, with an earnings call at 2, and investors will be listening less for numbers than for steadiness.
Huang is 63 and owns about 3.6 percent of the company stock. He leaves with no named successor and no public succession plan, at the very moment the company chips power the worldwide buildout of artificial intelligence and every government on Earth is fighting for position in that race.
For a company built around one man and one vision, the question now is what Nvidia is without him. Urban City Podcast will follow the earnings report and the search for a permanent chief executive.
