Nvidia’s market capitalization briefly dropped below $4 trillion on Thursday, November 12, after co-founder and longtime chief executive Jensen Huang resigned amid revelations of multiple extramarital relationships, including one involving a woman suspected by U.S. intelligence officials of having connections to Chinese espionage. The controversy has triggered investigations, heightened national security concerns and raised questions about leadership at the world’s leading artificial intelligence chipmaker.
Nvidia announced before Thursday’s market opening that Huang had stepped down immediately as president, chief executive officer and board member, ending his 33-year tenure at the company he co-founded in 1993. Chief Financial Officer Colette Kress has been appointed interim CEO while the board searches for a permanent replacement. Longtime board member and venture investor Harvey C. Jones has also been named chairman, marking a significant restructuring of the company’s leadership.
The scandal emerged after Huang acknowledged being unfaithful to his wife in a message to employees on November 8. Reports subsequently identified one of the women as Alice Huang, a former executive at Singapore-based cloud computing company Megaspeed International, which has maintained commercial relationships with Nvidia. American intelligence officials reportedly suspect her of having ties to Beijing’s intelligence services, although the allegations remain unproven. Chinese authorities have rejected the accusations.
Further revelations intensified pressure on Nvidia’s board after reports identified another relationship involving Kimberly Powell, the company’s vice president of healthcare, who reported directly to Huang. Reuters subsequently reported allegations of a third relationship involving an unnamed Nvidia employee. The disclosures raised additional questions about workplace governance, executive accountability and potential conflicts of interest.
Nvidia’s board has initiated an independent investigation into the allegations but maintains that it has no reason to believe company secrets or U.S. national security interests were compromised. The controversy has nevertheless reportedly prompted an FBI inquiry, shareholder litigation and congressional scrutiny, particularly concerning Nvidia’s business relationships in China and compliance with American semiconductor export restrictions.
The developments triggered significant volatility in Nvidia shares on Thursday. The stock plunged as much as 14.3% during early trading, temporarily erasing approximately $600 billion in market value and pushing the company’s valuation below $4 trillion. Shares subsequently recovered part of their losses, closing down 4.34% at $166.19, leaving Nvidia with a market capitalization of approximately $4.005 trillion.
The selloff added to losses recorded earlier in the week, with Nvidia reportedly shedding nearly $500 billion in market value since Huang first acknowledged the controversy. The decline has also coincided with broader weakness in artificial intelligence stocks following their October highs, increasing investor concerns about valuations and the sector’s outlook.
Huang’s departure represents a major turning point for Nvidia, whose rapid expansion under his leadership established it as a dominant supplier of advanced processors used in artificial intelligence systems worldwide. With the company now facing a leadership transition alongside regulatory and legal scrutiny, investors will be closely watching its next steps, including the appointment of a permanent chief executive and the outcome of ongoing investigations.
The controversy also highlights the intersection of corporate governance, national security and international technology competition. While allegations of espionage and the potential compromise of sensitive information remain unproven, the unfolding developments could increase pressure on Nvidia to demonstrate stronger internal oversight and transparency regarding its operations and business relationships.
