Jensen Huang Resigns as Nvidia CEO; CFO Kress Named Interim Chief

What happened

According to the Form 8-K Nvidia filed with the U.S. Securities and Exchange Commission the same day, the board accepted Huang's resignation on Nov 11, and the appointments of Kress and Jones were made the same day. The Nov 12 announcement carries no statement from Huang, gives no reason for the resignation and does not mention the independent investigation the board opened on Nov 8.

Kress, 59, has been Nvidia's chief financial officer since September 2013 and will keep that role while serving as interim CEO until a permanent successor is named. The board said the search will consider internal and external candidates and gave no timeline. Jones, 73, is a former chief executive and executive chairman of Synopsys and has served on Nvidia's board since 1993.

On the share price, Nvidia fell about 8% in after-hours trading on Nov 11 after The Wall Street Journal reported the board was preparing to remove Huang, and fell more than 13% intraday on Nov 12 after the resignation was announced, dropping as much as 14% during the session before closing down 4.34% at $166.19. Huang owns about 3.6% of the company's stock. Nvidia said its third-quarter results will still be reported as scheduled on Nov 17, with the earnings call at 2 p.m. PT, and gave no new financial guidance.

Background

On Nov 8, Nvidia's board announced that independent directors, assisted by outside legal counsel, had opened an investigation into whether Huang had been the target of a foreign intelligence operation; Huang acknowledged an extramarital affair the same day. On Nov 11, The New York Times reported that Huang had an extramarital relationship with Kimberly Powell, Nvidia's vice president of healthcare. These are press reports; Nvidia's resignation announcement confirmed no reason for the departure.

In a memo to employees, Kress said the company will hold a meeting on Nov 18. In the announcement, Nvidia said the board and the company thank Huang for his contributions to the company and the industry, and that operations, customer commitments and the product roadmap will continue without interruption.

Key facts

1. Resignation: Huang resigned as president, CEO and board member on Nov 12, effective immediately; the board accepted the resignation on Nov 11
2. Succession: CFO Colette Kress, 59, serves as interim CEO while keeping the CFO role; the board will consider internal and external candidates, with no timeline given
3. Chair: Director Harvey C. Jones, 73, becomes the company's first board chair
4. Reason: The announcement gives no reason for the resignation, carries no statement from Huang and does not mention the independent investigation opened on Nov 8
5. Shares: Fell about 8% in after-hours trading on Nov 11; on Nov 12 fell as much as 14% intraday before closing down 4.34% at $166.19
6. Background: The board opened an independent investigation on Nov 8; The New York Times reported on Nov 11 that Huang had an extramarital relationship with a company executive (both press reports)
7. Earnings: Third-quarter results are still scheduled for Nov 17, with no new financial guidance
8. Tenure: Huang co-founded Nvidia in 1993 and led it for 33 years; he owns about 3.6% of the stock