The abrupt resignation of Jensen Huang as CEO of Nvidia on Thursday following reports he engaged in multiple extramarital affairs leaves the AI giant facing an uncertain future, while a longtime company executive is stepping in as interim CEO.
Huang co-founded Nvidia in 1993 and served as its CEO until his resignation, transforming the company from a struggling startup into one of the world’s largest by market capitalization amid surging demand for its AI chips. He became a visionary and figurehead for the AI revolution.
Nvidia chief financial officer and EVP Colette Kress has been named as the company’s interim CEO and has served as Nvidia’s CFO since September 2013. She has deep experience in tech finance, as she previously worked as a CFO for Cisco’s business technology and operations finance unit and was also CFO of Microsoft’s server and tools division during a 13-year tenure at the software giant.
Analysts view Kress, who has featured prominently in Nvidia’s quarterly earnings calls, as a steady hand who can help the company navigate a tumultuous period following the departure of its longtime leader.
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Bret Kenwell, U.S. investment analyst at eToro, said that while “Huang was more than a CEO – he was part of the investment thesis,” the selection of longtime Nvidia executive Kress as interim CEO should “provide stability and reassurance” to investors.
“Kress has been a familiar presence at Nvidia and on its conference calls, offering a recognizable voice during an already fragile situation,” Kenwell added.
Nvidia is scheduled to report quarterly earnings next week on Tuesday, Nov. 17, which will give Kress an early opportunity to assuage investors’ concerns.
Dan Ives, partner and senior managing director at Yorkville Ives, said in a note that “Kress has built enormous credibility internally and externally and we are big fans of her strategically.”
“We always believed she would eventually be CEO of a major public tech company, but she would have to leave Nvidia after many years there,” Ives added.
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Huang’s departure will pose other challenges for Nvidia and Kress given the level of visibility he brought to Nvidia’s AI business and his ability to broker deals around the world.
Susannah Streeter, chief investment strategist at Wealth Club, said that Kress will be viewed as a “safe pair of hands” who has “been brought into steady leadership, but she lacks global status.”
Streeter added that Kress is “unlikely to be able to forge such deep commercial ties, and Nvidia will now enter this period of uncertainty over strategic priorities, pricing and supply agreements.”
Michael Landsberg, chief investment officer at Landsberg Bennett Private Wealth Management, said that Huang’s resignation “is the worst-case scenario during this entire saga.”
“He was not just a leader, but a visionary for the company, and while CFO Colette Kress is highly capable and respected, there are still big questions about how the innovation of Nvidia will evolve without Jensen.”
Gil Luria, managing director at DA Davidson, said that “Kress is well respected by investors and should be able to guide Nvidia through this challenging period.”
However, Luria cautioned that the “task is daunting, as Nvidia has been founder-led since inception and Mr. Huang concentrated much of the decision-making.”
Reuters contributed to this report.
