Investor Gary Black has expressed doubts about Nvidia Corp. (NASDAQ:NVDA) CEO Jensen Huang's ability to retain his position following an independent review initiated by the company's board. The review focuses on Huang's relationship with a woman allegedly linked to Chinese intelligence. Black, managing partner of Future Fund, stated that while Huang has not committed any crime or civil wrong, the scrutiny of his conduct and judgment is likely to lead to his removal by the board.
Black also suggested that the uncertainty surrounding Huang's succession could exert short-term pressure on Nvidia's stock. He noted that Huang lacks a natural successor within the company, which could prompt portfolio managers to reduce their holdings in the coming weeks. Despite this, Black does not foresee long-term value impairment for Nvidia.
In a message to employees reported by Axios, Huang apologized for his actions, admitting to being unfaithful to his wife and acknowledging the hurt caused to her and their children. Nvidia's board has formed an independent committee of directors, assisted by outside counsel, to oversee the inquiry. The company's public policy communications head, John Rizzo, affirmed that Huang remains committed to continuing as CEO without interruption.
The Times reported last month that Alice Huang, a former executive at Singapore-based Megaspeed, was allegedly tasked with seeking information and potentially influencing access to Nvidia’s advanced chips in China. Three House Republican committee chairmen have requested a closed-door briefing with Huang on Nov. 18 regarding his reported interactions.
On Friday, Nvidia shares closed at $186.64, reflecting a 2.78% increase. However, they fell 3.06% to $180.98 in overnight trading on Sunday. Benzinga Edge rankings indicate Nvidia’s stock has a Momentum score in the 20th percentile and a Growth score in the 98th percentile.