The drama continues to unfold at Nvidia headquarters, where it is now emerging that CEO Jensen Huang may have engaged in a second extramarital affair, this time with the company’s Vice President of Healthcare Kimberly Powell. NVDA shares plunged 8% during extended trading hours late on Wednesday night after five anonymous Nvidia insiders blew the whistle to the New York Times, revealing that Huang's relationship with Kimberly Powell was already an open secret among staff members. A bystander apparently recorded the two being affectionate during a developer conference in San Jose back in March, an act of sleuthing that was caught by Jensen’s security detail, who then pressured the bystander into keeping quiet about the footage. The second revelation prompted the Nvidia board of directors to convene to discuss Huang’s future as CEO of the company on Wednesday evening, the result of which has not yet been made public. The directors have the authority to remove Jensen with or without cause at any time by reaching a simple majority vote – a decision that the CEO would not have the power to override. Jensen Huang has faced intense scrutiny over the past week in light of his admitted affair with former Megaspeed executive Alice Huang. US authorities began investigating the Singapore-based company back in 2024 after the firm was suspected of diverting 240,000 restricted Nvidia chips to China. US intelligence officials have also suspected Alice Huang of working for China’s Ministry of State Security, further muddying the waters. The affair looks all the more nefarious when taken within the context of Jensen Huang’s aggressive lobbying tactics to loosen chip export controls to China, even while the CEO repeatedly insisted that there was no such evidence of chip smuggling into the country. Critics can easily argue that the secret relationship between the two executives extended far beyond a mere business affiliation, raising questions of whether the Chinese government had direct influence over US export rules and whether Nvidia can be trusted to police its own supply chain. The optics of the situation are self-evidently terrible. Nvidia and Jensen Huang are now the subject of multiple investigations. The US Department of Justice is pursuing a criminal investigation into whether Megaspeed illegally smuggled restricted chips into China after taking control of the probe from the Department of Commerce. The Federal Bureau of Intelligence is independently looking into the relationship between Jensen and Alice, and whether the latter obtained sensitive trade secrets through her proximity to the Nvidia CEO. The House Foreign Affairs Committee has summoned Huang to a closed-door hearing scheduled for next week to demand answers regarding the matter. Furthermore, Nvidia has launched its own investigation with the help of New-York-based law firm Wachtell, Lipton, Rosen & Katz. Finally, investors have filed a securities fraud lawsuit against Nvidia and its CEO in a federal court in California, alleging that shareholders were misled after the company failed to disclose the national security risks posed by the affair. The new story involving VP Kimberly Powell is another matter altogether. While the relationship with Alice Huang raises questions of national security and potential espionage, the affair involving the healthcare executive represents a more direct corporate violation. Nvidia has its own code of conduct regarding personal relationships, particularly between managers and subordinates. Deploying the CEO’s security personnel to supress evidence presents another huge red flag. There are many historical precedents of high-profile CEOs being ousted for comparable violations, with boards of directors often treating such acts as automatic termination events. Intel CEO Brian Krzanich resigned in 2018 after violating the company’s non-fraternisation policy; McDonald boss Steve Easterbrook was fired a year later for engaging in a relationship with a fellow employee; BP CEO Bernard Looney resigned in 2023 for the same reason; executives from CNN, NBC, Boeing and Hewlett-Packard were likewise terminated for similar misconduct over the years. While the board of directors at Nvidia may well have decided to part ways with CEO Jensen Huang, members are facing the difficult task of finding a replacement. Huang has famously rejected designating a successor or second-in-command throughout his years at Nvidia, opting instead for a flat management structure of 60 different executives all reporting directly to him. The lack of clear succession is likely a major factor weighing on the company’s stock price, which is currently down to $160 per share in overnight trading, from $240 earlier this month. About the Author Lawrence J. came from a strong technical and engineering background before pivoting into a more financial role later on in his career. Always interested in international finance, Lawrence is experienced in both traditional markets as well as the emerging crypto markets. He now serves as the financial writer for RADEX MARKETS. Reviewed by RADEX MARKETS Risk Warning: Trading derivatives and leveraged products carries a high level of risk, including the risk of losing substantially more than your initial investment.
