Nvidia stock drops 9% as the board weighs Huang's fate

Nvidia shares fell 9% premarket after its board met on CEO Jensen Huang's future; no decision announced.

According to CNBC and The Guardian, citing reporting by the New York Times, the Wall Street Journal and the Financial Times.

CNBC confirmed the board met Wednesday to discuss whether to remove Huang. Nvidia has announced no outcome and made no public statement on his future. Shares were down 9% at 8:36 a.m. ET Thursday; earlier CNBC readings were about 5% to 5.4%.

CNBC and The Guardian report Huang admitted an affair in a Sunday email to employees and said he would cooperate with an internal investigation. CNBC reports U.S. intelligence officials believe the woman is a spy for China; this is unconfirmed. The NYT reported a second relationship, with an employee who reports to him; Nvidia has not been quoted confirming it. The WSJ reported the board was preparing to oust Huang.

The Guardian reports the board hired Wachtell, Lipton, Rosen & Katz for an independent investigation and directed Huang to keep running the company. The board said it 'has no reason to believe that either national security or Nvidia secrets were compromised.'

In Washington, Sen. Kevin Cramer (R-N.D.) called on Huang to resign. Sens. Elizabeth Warren and Chris Coons asked the Trump administration to preserve documents tied to Nvidia's chip exports to China. President Trump has backed Huang. Citi analysts said CFO Colette Kress could serve as interim CEO; successor names remain speculation.

Watch for the board's decision and the investigation's outcome.

The facts we checked

According to CNBC and The Guardian, citing reporting by the New York Times, the Wall Street Journal and the Financial Times

1. Nvidia's board met Wednesday to discuss whether to remove CEO Jensen Huang; CNBC confirmed the meeting.Fact · CNBC
2. No outcome of the board meeting has been announced, and Nvidia has made no public statement on Huang's future.Fact · CNBC
3. Nvidia's stock was down 9% in premarket trading as of 8:36 a.m. ET Thursday. Earlier CNBC premarket readings put the drop at about 5% to 5.4%.Figure · CNBC
4. Huang admitted in an email to employees on Sunday that he had an affair and said he would cooperate with an internal investigation. The woman is Alice Huang, an executive at Megaspeed, according to the Financial Times as cited by CNBC.Reported · The Guardian, CNBC
5. The woman is alleged to be a Chinese spy; CNBC reports that U.S. intelligence officials believe she is a spy for China.Alleged · The Guardian, CNBC
6. The New York Times reported Wednesday that Huang had a second extramarital relationship, with a Nvidia employee who reports to him. Nvidia has not been quoted confirming this.Alleged · CNBC, The Guardian
7. The Wall Street Journal reported that Nvidia's board was preparing to oust Huang. This is the outlet's report; Nvidia has announced no decision.Reported · The Guardian, CNBC
8. Nvidia's board hired the law firm Wachtell, Lipton, Rosen & Katz for an independent investigation, and Huang was directed to keep running the company while it proceeds.Reported · The Guardian
9. The board said it 'has no reason to believe that either national security or Nvidia secrets were compromised.'Quote · CNBC
10. Sen. Kevin Cramer (R-N.D.) has called on Huang to resign, and CNBC reports U.S. lawmakers have called for his resignation.Fact · CNBC
11. Democratic Sens. Elizabeth Warren and Chris Coons asked the Trump administration to preserve all documents tied to Nvidia's chip exports to China.Fact · The Guardian, CNBC
12. President Trump has backed Huang, saying he had done 'an incredible job' and is 'an honorable guy.'Quote · The Guardian
13. Citi analysts said CFO Colette Kress could serve as interim CEO while the board evaluates external candidates. Bernstein's Stacy Rasgon said he could not 'even begin to speculate' who might replace Huang. Successor names are speculation.Reported · CNBC

Sources

• CNBCNvidia stock falls 9% as investors await Jensen Huang’s fate
• CNBC‘A dark day for Nvidia’: Here’s what analysts are saying as markets brace for news on Huang's fate
• CNBCNerves around Nvidia as investors await the outcome of Board's crisis CEO meeting
• The GuardianNvidia board reportedly deciding whether to oust CEO Jensen Huang as stock price plunges
• 9to5MacNvidia CEO Jensen Huang set to be fired, with Johny Srouji listed among possible replacements
• BBC NewsWho could replace Jensen Huang as Nvidia's chief executive?