Nvidia board acts after Jensen Huang’s Nov. 11 resignation

By Nathan Brooks

Nvidia accepted Jensen Huang’s resignation on Nov. 11 after reports of two additional employee relationships, while a board inquiry into reports that Huang was targeted by foreign intelligence continued. Within two days, the matter moved from a suspected Chinese intelligence operation to allegations about Huang’s conduct inside the company.

The New York Times reported on Nov. 11 that Huang had a relationship with Kimberly Powell, Nvidia’s vice president of health care and a direct report, citing five people who worked at the company. Powell did not respond, Reuters could not verify the account, and neither Nvidia nor Huang has confirmed it.

What did the new reporting show?

CNBC, citing the Times, reported that a camera recorded Huang and Powell being affectionate at a San Jose hotel in March. Powell has led Nvidia’s health care group since 2017. Yahoo Finance’s live coverage of CNN reported that she was no longer scheduled to speak at the Milken Future of Health Summit.

Reuters reported on Nov. 12, hours after the resignation, that Huang had an intimate relationship with another Nvidia employee. Reuters did not name the employee and gave no title or department; TechCrunch counted the allegation as Huang’s third reported affair, after Alice Huang and Powell. Neither Nvidia nor Huang has commented on either report, and the company has not confirmed the allegations.

Why did the board act before the inquiry ended?

The Wall Street Journal reported on Nov. 11 that the board was preparing to remove Huang after two extramarital affairs, one involving someone described as a suspected Chinese spy, according to Reuters’ account of the paywalled story. In his only public admission, a Nov. 8 note to staff, Huang wrote: “I was unfaithful to my wife.” He named no one.

A relationship with a direct report gave the board an immediate governance issue, separate from the foreign-intelligence inquiry. Bernstein analyst Stacy Rasgon told CNBC on Nov. 12 that the situation was fluid and that the alleged relationship “makes it much tougher for the board to leave him in position.”

Nvidia had published no reason for the board’s decision. The board had expressed confidence in Huang on Nov. 8, yet CNBC reported on Nov. 11, citing a person familiar with the matter, that the board had decided to remove him by that night.

What did company policy permit?

Nvidia’s code of conduct lists personal relationships among potential conflicts, alongside outside consulting, board seats and advisory roles. It directs employees facing a possible conflict to contact Employment Legal, although Reuters said it remained unclear whether Huang breached the policy.

Nvidia’s bylaws allowed the board to remove a chief executive with or without cause by majority vote. That process resembled pulling a circuit breaker rather than reaching a verdict: the board did not need a finding of a policy breach before acting. Nvidia has issued no finding on whether either reported relationship broke company policy.

What does the board investigation cover?

Nvidia’s independent directors opened the review on Nov. 8, describing it as an examination of recent reporting that Huang was the target of a foreign intelligence effort. The committee worked with outside counsel, and neither board statement mentioned relationships with employees.

On Nov. 10, the independent directors hired Wachtell, Lipton, Rosen & Katz and Joon H. Kim, a former acting U.S. attorney for the Southern District of New York, to conduct what Nvidia called a thorough and independent investigation. Nvidia has not said whether its mandate widened after the Times and Reuters reports.

The Information reported that the board will continue investigating Huang’s ties to Alice Huang after his resignation. Huang has retained his own lawyers, with CNBC confirming that Paul Weiss represents him. Nvidia has not said whether the investigation’s findings will be published.

What has the company disclosed?

The company’s Nov. 12 filing says the board accepted Huang’s resignation on Nov. 11. It gives no reason, describes no disagreement and discloses no severance. Interim chief executive Colette Kress told staff the period was extraordinarily difficult, without explaining the decision.

Huang has agreed to testify before Congress before Thanksgiving, House Foreign Affairs Chair Brian Mast said. The committees’ request focuses on his ties to Alice Huang and national security.

The next competitive variable is Nvidia’s permanent leadership: the company has named no successor, and it has not said whether the review mandate widened. The resignation is official; the explanation is not.