The catalyst for this board action was a series of escalating reports from The New York Times, which alleged that CEO Jensen Huang had engaged in two separate extramarital relationships. The first, reported earlier in the week, involved Alice Huang, an executive at Megaspeed, whom U.S. intelligence agencies have identified as a Chinese intelligence operative. On Wednesday, the Times added a second layer to the scandal, citing five people who worked at Nvidia, claiming that Jensen Huang also had a romantic relationship with Kimberly Powell, the company’s vice president of healthcare. Sources indicated that the two were seen being affectionate with each other as recently as March, despite both being married.
While Nvidia has not confirmed the specifics of the Times’ reports or the board’s intentions, the market reacted to the perception that Huang’s tenure is ending. The company had previously stated that Huang would remain as CEO while an internal investigation proceeded into whether he had been targeted by a foreign intelligence operation. However, the revelation of the second affair with a direct subordinate appears to have altered the board’s calculus. The Wall Street Journal reported that the board now intends to remove him, a move that underscores the severity with which the company is treating the potential conflict of interest.
The implications of Huang’s potential departure extend far beyond corporate governance, striking at the core of the United States’ technological advantage. Nvidia is widely regarded as the architect of the current AI trajectory, providing the essential hardware for the industry’s rapid expansion. Stacy Rasgon, a top chip analyst at Bernstein Research, described Huang as central to this position, noting that the primary beneficiary of his removal would likely be China, which is aggressively investing in its own AI capabilities. Rasgon slashed Nvidia’s price target to $200 from $400, stating, “We can’t even begin to speculate as to who they might find to fill Jensen’s shoes.”
Analysts warn that losing Huang at this critical juncture could create unnecessary disruption for the U.S. tech sector. Brad Gastwirth, global head of research at Circular Technology, characterized the removal as a “tremendous mistake,” arguing that Nvidia is central to America’s AI leadership. The concern is not merely financial but strategic; the U.S. maintains a significant lead over China in AI development, and a leadership vacuum at the industry’s most influential firm could widen the gap or destabilize the ecosystem. Eric Wallerstein, chief macro strategist at Clocktower Group, highlighted the structural risks, noting that Huang has fostered a complex web of circular financing relationships and backstopped the AI trade with Nvidia’s balance sheet. Removing that “put,” as Wallerstein described it, could shake investor confidence in the broader AI market.
The internal dynamics of the scandal are complicated by Nvidia’s own code of conduct. While the code does not explicitly prohibit employees from cheating on their spouses or dating coworkers, it warns against conflicts of interest that may include personal relationships. It further states that managers “serve as role models” and must ensure their conduct upholds the company’s reputation. In a letter preceding the code, Huang himself urged employees to maintain high ethical standards. The tension between these stated values and the reported behavior has intensified scrutiny on the board, which now faces the difficult task of managing a transition that could impact not just one company, but the global AI landscape.
Political figures have also weighed in, with Senator Kevin Cramer (R-N.D.) stating he feels “strongly” that Huang should resign, saying, “I can’t believe we are even considering him not resigning.” Meanwhile, the Chinese government has denied the espionage allegations, calling them “purely unsubstantiated and directed at smearing China.” Nvidia, for its part, has not responded to multiple requests for comment on the developments.
As the board concludes its Wednesday night meeting, the immediate question remains what will happen to the world’s most valuable chipmaker. The market has already voted with its feet, pricing in a significant risk premium for leadership instability. Whether the board chooses to oust Huang or retain him, the episode has exposed the fragility of the current AI leadership structure and the enormous personal capital invested in a single executive. The next confirmed step is the board’s official statement on Huang’s status, which will determine whether the $300 billion correction is the beginning of a new era for Nvidia or a temporary dip in a continuing trajectory.
