Nvidia CEO Jensen Huang Resigns, Effective Immediately

Nvidia has announced that Jensen Huang has resigned as president and CEO of the company, effective immediately.

Nvidia's current Chief Financial Officer, Colette Kress, will serve as interim CEO while keeping her CFO duties until a permanent replacement for Huang can be found. Harvey C. Jones, a longtime tech executive and investor, has been appointed as Nvidia's first-ever Chair of the Board, and the company says that operations, product plans, and customer commitments will continue without interruption. Nvidia's Q3 2017 financial results will still be reported on its scheduled date of November 17.

Things began to look dire for Nvidia CEO Jensen Huang after it was revealed that he'd been involved in an extramarital affair with a suspected Chinese spy. This week, news broke that he'd also taken part in a second affair with one of his executives.

According to The New York Times, the Nvidia board of directors scheduled a meeting to discuss the situation, just days after launching an independent investigation into him. After the affair was first exposed, Nvidia quickly issued a statement saying that none of the company's secrets, or US state secrets, had been compromised. Huang also issued a letter to Nvidia employees, apologizing to his wife and children.

With AI technology taking off in the last couple of years, Nvidia has become a major supplier of the crucial hardware components powering this boom. While the company is best known for its graphics cards, its fortunes have risen exponentially as it has focused more heavily on AI chips, with Huang becoming the face of the AI boom in the US. Huang is also Nvidia's founder, having started the company in 1993 and run its day-to-day operations for decades. With a 3.56% stake, he's also Nvidia's largest shareholder.

His removal could have huge ramifications for the company, given how involved he was in running it and the reported lack of a succession plan. The revelation of a second affair has seen Nvidia's stock tumble, and the company's board may feel pressured to remove him as CEO to do some damage control.

"If Jensen Huang is ousted as is expected, an already challenging environment for Nvidia investors and employees will become considerably more difficult," chief market strategist at JonesTrading Mike O’Rourke told CNN. "Nvidia is currently the most important company in the world. "The new CEO will need to make an extensive appraisal of the company, and Jensen’s successor will not have the same latitude or deference to pursue circular deals and pursue aggressive sales tactics."