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Nvidia CEO Jensen Huang steps down amid affair allegations

Nvidia co-founder Jensen Huang has resigned as chief executive after allegations of extramarital affairs, and the chip maker's shares fell. The episode raises questions about who will lead the AI chip leader and how far the fallout will spread.

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Jensen Huang, the co-founder who led Nvidia as chief executive, has stepped down from the role. The company's board had been weighing his future after allegations that he had several extramarital affairs, one involving a woman suspected of spying for China. Colette Kress is serving as interim chief executive while the board works with an outside firm to identify possible replacements.

Shares slid 7% before the regular session opened, and fell as much as 8.4% in premarket trading. The company's value dropped by $888 billion over the week. Had those early losses held, Nvidia would have fallen below $4 trillion in market value once cash trading resumed. Nasdaq 100 contracts fell 0.9%, which could wipe out a large part of the index's strongest week since May.

NVIDIA$162.85down −26.41%over 1 month
$221.97$162.8514 Oct13 Nov

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Nasdaq Compositedown −5.83%1 month

Huang held a 3.6% stake, a plain shareholding without the enhanced voting rights common at some rival firms. Before this episode, the board does not appear to have spent much time on succession planning. Bernstein Research cut its rating on the stock to market perform from outperform and lowered its price target to $200 from $400.

Lawmakers have pressed for Huang to testify before Congress. Jim Banks has called for Lutnick to testify on the controversy, alleging the use of a 'loophole'. The Justice Department is also probing Nvidia, Supermicro and Megaspeed.

For investors who hold Nvidia shares directly or through funds, the week brought a sharp fall in value. The episode also puts a spotlight on trade relations between the United States and China, and on the supply chains that link chip makers, cloud providers and AI developers.

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Background

Huang co-founded Nvidia and, over three decades, steered it from a niche graphics-chip designer into a company valued at $4 trillion. Its chips underpin the AI economy, and AI models such as ChatGPT and Claude depend on them.

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