Nvidia shares plunge 8% after WSJ reports board preparing to oust Jensen Huang amid affair allegations

Nvidia shares fell nearly 8% in after-hours trading Wednesday after a media report said the company's board is preparing to remove CEO Jensen Huang.

The Wall Street Journal, citing people familiar with the matter, reported Wednesday (local time) that Nvidia's board is preparing to oust Huang and could hold a meeting as soon as that day to decide his future at the company.

The crisis stems from allegations that Huang had two extramarital affairs, one of them with a woman suspected of being a Chinese spy, according to the Journal.

Earlier, Nvidia's board issued an official statement Sunday saying it had found no basis to conclude that US national security or company secrets had been compromised. The board also stated at the time that it maintained confidence in Huang and the company's management.

If the Journal's report is accurate, the board would have reversed course in just three days after publicly expressing confidence in Huang — moving from a vote of support to actively considering his removal.

The New York Times reported the same day that Huang also carried on an extramarital affair with a Nvidia executive who reported directly to him — Kimberly Powell, 48, vice president of Nvidia's healthcare division. The report added a second set of allegations to those already surrounding his relationship with the woman suspected of being a Chinese spy.

After the reports emerged, Nvidia shares extended their after-hours decline to nearly 9%. The stock had closed up 2.87% at $173.73 in regular trading that day.

Should Huang's departure become a reality, the question of succession would emerge as Nvidia's biggest source of uncertainty. Huang has led the company for 33 years since co-founding it in 1993, personally driving semiconductor product development, business strategy, partnerships with major hyperscaler customers and government relations.

"The market will be watching closely to see whether Jensen Huang is actually removed, whether he retains influence over management through the board even if he steps down as CEO, and whether new leadership would carry on the existing AI investment strategy," said Seo Sang-young, a managing director at Mirae Asset Securities. "With Nvidia's earnings announcement coming next week, share price volatility could increase as investors weigh both the leadership situation and the earnings outlook."