Nvidia's board is set to consider removing chief executive Jensen Huang at a meeting on Wednesday, raising questions about the future leadership of the world's most valuable chipmaker.
A source familiar with the matter told Reuters that the board would discuss Huang's possible ouster amid growing controversy over his personal relationships and alleged links to China.
Huang's potential exit, at 63, could mark a major turning point for the $4 trillion chipmaker. He co-founded Nvidia in 1993 and has led the company for more than three decades. Under his leadership, Nvidia has become the world's leading supplier of artificial intelligence (AI) processors.
Nvidia faces leadership uncertainty
Huang's possible removal could create a significant succession challenge. The company has no obvious successor in place.
He owns approximately 3.6% of Nvidia's shares and has dozens of direct reports, highlighting his influence over the company's operations.
An immediate departure could disrupt its leadership structure. It would also come at a critical time for the AI industry.
"Huang being removed immediately could be challenging for Nvidia since it does not have a succession plan in place ... If Huang broke the law or violated company policies, the board is likely to act as soon as they have proof," Gil Luria, head of technology research at D.A. Davidson, said.
The reports have already affected investor sentiment. Nvidia shares fell approximately 8% in after-hours trading after The Wall Street Journal reported that the company was preparing to oust Huang.
The latest decline adds to an estimated $600 billion loss in market value this week. This followed the board's announcement of an investigation into Huang's relationship with a Chinese businesswoman.
Personal allegations
The leadership uncertainty follows reports of two extramarital relationships involving Huang.
On Wednesday, The New York Times reported that Huang had a relationship with Kimberly Powell, Nvidia's vice president of healthcare, who reportedly reported directly to him. The report cited five former company employees.
Nvidia and Powell did not immediately comment. Reuters said it could not independently verify the report.
Asked about his relationship with Powell by The New York Times, Huang said, "I don't think you should be talking to me directly." He then hung up, the newspaper reported.
In a memo to employees on Sunday, Huang admitted being unfaithful to his wife and took "full responsibility", without sharing further details.
The controversy began with reports of his relationship with Alice Huang, a Chinese businesswoman allegedly linked by US intelligence to chip shipments to Chinese firms.
Nvidia's board subsequently launched a probe into whether Huang had been targeted by a foreign intelligence operation. Independent directors are overseeing the investigation with external legal counsel. The board had initially expressed confidence in him.
Investors assess wider impact on AI industry
Huang's possible exit has raised concerns about Nvidia's wider business ecosystem. Analysts expect demand for its AI processors to remain strong, but warn that the company's interconnected investments could face risks.
"Nvidia is also at the centre of the circular financing which is providing capital to the investment boom," said Nick Ferres, chief investment officer at Vantage Point Asset Management in Singapore.
"They are financing their customers. In these types of booms or bubbles, sometimes all it takes is a slowdown to shift it into the bust phase."
The uncertainty has also affected semiconductor stocks. Nvidia shares fell, while rivals AMD and Broadcom gained 4% and 3%, respectively, in after-hours trading. Investors are weighing whether competitors could benefit from the turmoil.
Meanwhile, US President Donald Trump backed Huang, calling him "an honorable guy" who had "done an amazing job for our country". He said he had not discussed the allegations with the CEO.
Huang also faces possible congressional scrutiny. House Republicans have sought a closed-door briefing on his alleged links to the Chinese businesswoman. He could face a subpoena if he does not respond.
Separately, Axios reported that US Commerce Secretary Howard Lutnick had stalled Trump's efforts to crack down on companies suspected of diverting Nvidia chips to China.