Huang’s Nvidia exit draws comparisons to Bezos, Gates

Jensen Huang resigned from Nvidia ↘ 2.01% after admitting to extramarital affairs, and commentators are now comparing his case with the marriage scandals of Jeff Bezos, Bill Gates and Elon Musk. Most of them reach the same conclusion: Huang's affairs could cost his company far more than theirs cost theirs. Huang stepped down on November 12 as CEO, president and board member, after revelations that included a relationship with a woman U.S. officials suspect was spying for China, AP reported. Chief Financial Officer Colette Kress is serving as interim CEO.apnews.com

A scandal unlike the others

In a Business Standard column, Devangshu Datta wrote that Gates, Bezos, Sergey Brin and Musk all went through affairs or divorces that had no effect on the daily running of Microsoft ↗ 0.17%, Amazon Amazon.com, Inc. ↘ 0.29%, Tesla ↘ 1.82% or Alphabet ↘ 0.96%. Huang's case is different, he argued, because of the geopolitics involved and because Huang ran Nvidia with more than 40 departments reporting directly to him.business-standard.com

The woman at the center of the case, Alice Huang, is a former executive at Singapore-based Megaspeed, an Nvidia customer. U.S. intelligence believes she was recruited by China's Ministry of State Security, GSMArena summarized, citing The New York Times ↗ 1.89%. The Times later reported a second affair, with Kimberly Powell, Nvidia's vice president of health care, according to CNBC. Congressional committee chairs have asked Huang to attend a closed-door briefing on November 18, AFP reported.cnbc.com+2

The cost of a divorce

Huang has been married to Lori Huang since 1985. No official report says the couple is separating, LBC noted. However, their marriage predates his wealth, so California law could split their assets equally, and a payout could reach $63 billion. By comparison, MacKenzie Scott received $35 billion from Bezos in 2019, and Melinda French Gates holds the record at $76 billion. La Repubblica put Huang's potential cost at about $70 billion.lbc.co.uk+1

Markets and leadership

According to AFP, the scandal has wiped almost half a trillion dollars off Nvidia's market value. Shares of Broadcom ↘ 4.76%, Intel ↘ 2.52% and Advanced Micro Devices ↘ 8.75% rose on November 12, while CoreWeave ↘ 6.13% closed down almost 7%, the Associated Press reported.afp.com+1

"Huang had played an outsized role as its chief strategist, dealmaker and — very importantly — political advocate, with close access to both Washington and Beijing," Lizzi C. Lee of the Asia Society Policy Institute told the AP. Asa Hiken, an analyst at eMarketer, called the resignation "a watershed moment for Nvidia, which now has to prove it can maintain its AI dominance without the leader largely responsible for building it."abcnews.com