SACHA PFEIFFER, HOST:
The CEO of NVIDIA, Jensen Huang, has resigned. That comes after reports that Huang had extramarital affairs, including one with a suspected Chinese spy. NPR tech correspondent John Ruwitch has been following this all week, and he's on the line now. Hi, John.
JOHN RUWITCH, BYLINE: Hey, Sacha.
PFEIFFER: John, when the company announced Huang's resignation today, what else did it say?
RUWITCH: Look, they didn't say a whole lot about Huang himself, actually. In a brief online statement, the company said Huang had resigned not only as CEO but as president and as a board member, and it said his contributions to NVIDIA were, quote, "profound" and "immeasurable." The announcement also said that Colette Kress has agreed to be the interim CEO. She's an executive vice president and chief financial officer of the company.
NVIDIA did not state a reason for Huang's resignation, but this all comes after reporting from The New York Times and others that Huang had a relationship with a Chinese woman who U.S. intelligence agencies think was recruited by Beijing as a spy. And then yesterday, the Times had another huge scoop, reporting that Huang had a second affair, this time with a senior NVIDIA executive, and that seems to have been the last straw.
PFEIFFER: We've been hearing all week that Huang is basically synonymous with the company and so key to it that the board didn't really want to let him go. So what does it mean that he's now out?
RUWITCH: Yeah, it's a big deal. NVIDIA is one of the biggest companies on Earth. It's one of the most important companies because it makes the most widely used chips that power AI. Jensen Huang was there from its founding 33 years ago, and he shepherded it from being a maker of niche video game graphics cards for computers to a company that has enabled the AI boom, really. NVIDIA makes really powerful chips that are the gold standard for AI. They're in data centers everywhere. I'm willing to bet, Sacha, that you've used an AI chatbot, and I think it's fair to say that NVIDIA chips probably played a part in training it and running it. So this resignation is significant, and it raises a lot of questions.
PFEIFFER: Questions like?
RUWITCH: Like - well, OK. First, there's a lot we don't know about the spy allegations, which NPR has not independently confirmed and which China denies. We don't know if any NVIDIA information might have been compromised or national security for that matter. The U.S. bans the export of NVIDIA's best chips to China, so that's why allegations that Huang was involved with someone who might have been a spy for China are so alarming.
Second, the company faces uncertainty. You know, Jensen Huang was, by all accounts, a micromanager. He had his hand in loads of decisions at the company, big and small. Dozens of senior employees looked to him for direct guidance. And Jensen Huang had no apparent succession plan. Stephen Witt, author of a book about NVIDIA called "The Thinking Machine," says this creates a huge hole in the company.
STEPHEN WITT: There's no obvious replacement. It's not even clear NVIDIA can be the same kind of company without Jensen. I have a hard time imagining what NVIDIA looks like without Jensen.
RUWITCH: The interim CEO, Colette Kress, you know, knows her way around NVIDIA, but she's temporary and she has big shoes to fill. She has to reassure staff and investors that NVIDIA can still be NVIDIA without Jensen Huang, and we may start to see some of that on Tuesday when the company reports its quarterly earnings.
PFEIFFER: Anyone that follows the markets know that companies like NVIDIA really underpin a lot of our retirement accounts, for example. So how have investors...
RUWITCH: Yeah.
PFEIFFER: ...Been taking this news?
RUWITCH: Yeah, as of this afternoon, the share price was down about 11% since the close of trading on Friday before things really blew up. For comparison, NVIDIA's main chipmaking rival, AMD, is up nearly 30% over that time. You know, NVIDIA has been one of the drivers of the stock market's bull run, and there are concerns that because so many companies rely on NVIDIA technology that if it gets into trouble, the whole AI boom may be in trouble. Now, NVIDIA shares have rebounded a little from their lowest lows thanks to this resignation announcement. You know, the old saying is the market hates uncertainty. Well, now we know with certainty that Jensen Huang is out, and we know who has the reins, at least for the time being.
PFEIFFER: That is NPR tech correspondent John Ruwitch. Thanks, John.
RUWITCH: You're welcome. Transcript provided by NPR, Copyright NPR.
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