Nvidia succession questions mount amid Huang probe

Investors and industry analysts are now openly asking who could lead Nvidia ↘ 5.47% after Jensen Huang. The company's board is investigating whether its co-founder and CEO was the target of a foreign intelligence effort, and the FBI is reportedly looking into the matter as well. In a Tuesday analysis, The Information wrote that headhunters are "probably calling around the semiconductor industry right now" to find candidates to pitch to Nvidia's board in case it decides Huang has to go.theinformation.com

The board has said it has confidence in Huang. Still, the episode has drawn attention to a company that has no public succession plan and no obvious second-in-command.

Probes and an admitted affair

On November 8, Nvidia's board said a committee of independent directors, working with outside counsel, would investigate reports that Huang had been "the target of a foreign intelligence effort." The board added that it had no reason to believe national security or company secrets were compromised. The same day, Huang admitted in a memo to employees that he had been unfaithful to his wife, according to ABC News. The New York Times had reported that the woman, Megaspeed executive Alice Huang, was gathering information for Beijing. China called that claim "nothing but smears against China," according to the Associated Press.abcnews.com+2

On Monday, President Donald Trump said the FBI was "looking into it" but that Huang would "be in good shape." Nvidia shares closed down more than 4% that day, the AP reported.abcnews.com

Outside names and obstacles

According to The Information's analysis, AMD Advanced Micro Devices, Inc. ↗ 1.30% CEO Lisa Su and Arm ↘ 2.58% CEO Rene Haas are possible outside candidates, as summarized by The Standard. Su has a strong record at AMD, but the companies' rivalry and her reported distant family ties to Huang would complicate any move. Haas worked at Nvidia for seven years and may be the easier fit. The analysis also said Chief Financial Officer Colette Kress could serve as interim CEO but is not seen as a long-term choice.thestandard.com.hk

The structure inside Nvidia adds to the challenge. Roughly 60 executives report directly to Huang, and he has said he does not believe in succession planning, The Wall Street Journal News Corp ↗ 1.64% reported. Melius Research analysts wrote that there is "no clear successor" and that they had expected Huang to stay for at least 10 more years, according to CNBC Comcast Corporation ↗ 0.98%.cnbc.com+1

"Jensen is Nvidia"

Most analysts do not expect Huang to leave. "Jensen is Nvidia. Nvidia is Jensen," Bernstein AllianceBernstein Holding L.P. ↗ 0.53% analyst Stacy Rasgon told CNBC, adding that Huang "sort of pulls all the strings." Nvidia has said Huang is "committed to continuing to lead Nvidia as CEO without interruption." The Information argued that even if the board clears him, people may wonder whether that decision was partly shaped by the lack of suitable successors.abcnews.com+2