Shares of Nvidia fell more than 8% as Nvidia’s board of directors is reportedly preparing to remove CEO and co-founder Jensen Huang, according to The Wall Street Journal, in a development that could mark a major leadership shake-up at one of the world’s largest technology companies.
The report emerged amid allegations involving two extramarital relationships, which have also prompted investigations by the company and the US government over potential national security concerns.
Nvidia shares fell 9.5% over the first two trading sessions following the initial revelations on Monday, before recovering 2.9% on Wednesday. However, the share price fell 8.6% afterhours following the report of Huang’s removal.
Several reports disclosed details of a second alleged relationship, claiming that Nvidia’s board was preparing to remove Huang from his leadership position. Such a move would mark a significant departure for the company, given Huang’s longstanding tenure as chief executive and his status as a co-founder.
The allegations involve two women, including Alice Huang, an executive at Singapore-based Megaspeed, a company identified as an Nvidia customer with reported connections to the Chinese government. Following the initial revelations, Jensen Huang issued a formal apology, while the US government and Nvidia’s board initiated separate investigations into whether the matter involved a potential breach of national security.
A second alleged relationship involved Kimberly Powell, Nvidia’s vice president of healthcare, according to The New York Times report.
The investigations are examining whether Huang may have been the subject of a foreign intelligence operation. However, Nvidia has stated that it has found no grounds to believe that government information or the company’s proprietary technology and trade secrets were compromised.
Huang has publicly backed the investigation, following his formal apology over the allegations.
