S&P 500 declines as Huang ouster sends Nvidia reeling: Live updates

Nvidia CEO Jensen Huang announced he will step down from his position, leaving the AI industry without its biggest advocate and casting doubt on the future of the company he transformed into a leading force in artificial intelligence. Colette Kress, Nvidia's Chief Financial Officer, will serve as interim CEO until a permanent successor is found, the company announced on Thursday.

Meanwhile, former Synopsys CEO and board member Harvey Jones was appointed as the first-ever board chairman. Huang, who co-founded Nvidia and holds a 3.61% stake in the company, will also resign from the board. Nvidia's shares plummeted more than 10 percent in premarket trading, impacting the broader market as well. Huang's departure came amid mounting pressure, following reports of an affair with a Chinese businesswoman suspected of espionage by US authorities.

China has dismissed the accusations as baseless. In light of these revelations, Nvidia's board convened on Wednesday to discuss his resignation. Separately, reports emerged suggesting Huang had an extramarital affair with a senior company executive who reported to him. Huang's resignation plunges the $4 trillion company into uncertainty and poses a threat to the AI ecosystem he fostered by reinvesting Nvidia's growing cash reserves into cloud providers, suppliers, and the industry's leading research centers.

While Nvidia's technology roadmap remains largely defined for years to come, the real risk lies in execution. Michael Feldman, portfolio manager at ClearBridge Investments, noted that Huang had been the chief conductor of a complex system, and his absence could disrupt the delicate coordination required for success. The recent volatility in AI stocks is already concerning, as rising cash burn and mounting debt at traditionally cash-rich tech giants raise doubts about the sustainability of the AI boom.