SAN FRANCISCO, Nov 11 (Reuters) – Nvidia’s board is meeting on Wednesday to decide whether to oust CEO Jensen Huang, a source familiar with the matter told Reuters, as the world’s dominant supplier of AI processors grapples with reports of two extramarital affairs involving its longtime leader.
Nvidia did not immediately respond to a request for comment on the board meeting.
The Wall Street Journal reported on Wednesday that Nvidia’s board is preparing to oust Huang, citing people familiar with the matter.
Here are some reactions to the report:
SHAY BOLOOR, CHIEF MARKET STRATEGIST, FUTURUM EQUITIES
“I think the market needs to separate leadership crisis from Nvidia’s actual business because Blackwell demand, the Rubin roadmap, networking expansion and CUDA ecosystem were already firmly established long before this fiasco, so I don’t see the next 12 to 18 months of revenue suddenly disappearing if Jensen were to leave.
“My bigger concern is next decade because Jensen isn’t simply Nvidia’s CEO but he’s the person who has consistently identified where computing is going before customers even realize they need those tech and replacing that strategic vision at a company built around 60 direct reports and no obvious second-in-command is an enormous challenge.
“If a transition becomes necessary then Ian Buck is the strongest long-term internal candidate given his role in creating CUDA and leading Nvidia’s hyperscale business and Arm CEO Rene Haas is an external candidate worth considering given his seven years at Nvidia.”
JUN BEI LIU, LEAD PORTFOLIO MANAGER, TEN CAP
“He’s the face of Nvidia and Nvidia has been front and center of the AI build-out.
“And if we look at how many new cloud data center businesses have been sponsored in this circular financing world, it’s pretty much all by Nvidia. And so I actually think it has quite a meaningful ramification for what is to come.
“Are they still going to give that much funding? Is neocloud still going to be a focus for them? There’s just a lot of uncertainty to come … not just for Nvidia, it’s for the whole AI, the circular financing, the AI build-out, all the businesses that they co-invest and sponsor.”
NICK TWIDALE, CHIEF MARKET ANALYST, ATFX GLOBAL
“I think we will see him leave the company and they are probably just going through a negotiation process at the moment while also working a strong PR angle to give investors confidence that Nvidia will remain the market leader moving forward without him — although I suspect some sort of consultant role in the future. I think the initial reaction to his resignation will be a further hit to the share price … although we have it well priced in at the moment.
“The broader AI trade though does seem robust in the current positive environment. So we may see some initial negative reaction before investors look elsewhere in the AI sector for more value.”
CHARU CHANANA, CHIEF INVESTMENT STRATEGIST, SAXO
“Looks like investors now need to put a higher probability on the risk of a leadership change at Nvidia. That creates a fresh layer of uncertainty. There’s also uncertainty about what that would mean for Nvidia’s business plans, especially in China, and whether a new leader would carry forward Huang’s broader strategic vision.
“Nvidia’s technology and engineering strengths won’t disappear overnight. But until there’s more clarity on leadership, the investigations and the implications for its China business, investors may be less willing to pay the same premium for its future growth.”
JOSH GILBERT, LEAD ANALYST, ETORO
“Because the market has only ever known Nvidia with Huang in charge, working out what it’s worth without him won’t happen overnight. None of this changes how many chips the big tech names want to buy, but investors want certainty at the top as much as they want growth, and right now Nvidia can only offer one of those. Markets have dealt with CEO scandals before, but never at a company so imperative to the biggest investment theme in the world.”
JAKE DOLLARHIDE, CHIEF EXECUTIVE OFFICER, LONGBOW ASSET MANAGEMENT
“It looks bad from every single angle. I believe the board won’t oust him until they have an all-star, a known entity in the tech sector, to replace him … The board’s thinking, we have to have a home run at least as far as an interim CEO, if not, the permanent replacement.
“At the end of the day, let’s not forget that the Nvidia chip is the centerpiece of the AI story. And so whether Jensen Huang’s around or not, it’ll continue to be the centerpiece of the AI story globally, but particularly here in the US. So, Nvidia will continue to be the absolute centerpiece of the AI universe as we know it.”
CHRIS WESTON, HEAD OF RESEARCH, PEPPERSTONE
“This is the man who’s got all the relationships … to the Chinese, Japanese, Koreans … one expects they’re going to bring someone in who has similar relationships and it’s going to be fairly seamless.
“It just means they do have a bit of a PR problem and potentially there could be some constraints from the government level. But the new person coming in isn’t going to derail their product suite.
“What you’re also seeing is a move higher in the after-hours prices in AMD and Broadcom. So, market share is clearly going to get picked up by those other producers.
“(And) if Trump or even the Democrats … had Nvidia under the spotlight and wanted to use Nvidia as a political pawn between China and the US, they have absolutely every reason now to go hard on them.”
GIL LURIA, MANAGING DIRECTOR, D.A. DAVIDSON & CO
“Mr. Huang being removed immediately could be challenging for Nvidia since it does not have a succession plan in place. Investors would expect the board to live up to their fiduciary responsibility. If Mr. Huang broke the law or violated company policies, the board is likely to act as soon as they have proof.”
BRUCE ZARO, MANAGING DIRECTOR, GRANITE WEALTH MANAGEMENT
“Jensen was the one who has led the marvelous rise of Nvidia … he spearheaded that, but they have 42,000 employees, and I guess the question would be, can someone step up if Jensen has to resign or is forced out? Can someone step up and be the ambassador that he has been with the data centers? I guess that’s the question that will be answered in time.”
(Reporting by Ankur Banerjee, Mrinmay Dey, Caroline Valetkevitch, Tom Westbrook and Prathik Jayaprakash; Editing by Peter Henderson and Chris Reese)
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