Key Notes
- Nvidia shares fell more than 3% after hours following a new report about CEO Jensen Huang.
- The Times alleged a relationship with healthcare executive Kimberly Powell, according to CNBC.
- Independent directors have hired outside counsel to investigate earlier national-security reporting.
Nvidia (Nasdaq: NVDA) shares fell more than 3% in after-hours trading Wednesday after a report alleged that chief executive Jensen Huang had an extramarital relationship with another executive at the chipmaker, renewing pressure on the stock just as it had begun to recover.
The New York Times identified the executive as Kimberly Powell, Nvidia’s vice president of healthcare, according to CNBC. The allegation comes days after Huang acknowledged infidelity and Nvidia’s board announced an independent investigation into separate reports of a foreign intelligence effort targeting him.
NVDA Gives Back Its Rebound
The shares traded at $167.47 at 5:14 p.m. Eastern time on November 11, down $6.26, or 3.60%, from their regular-session close, according to CNBC’s quote data. Nvidia had finished the trading day at $173.73, up 2.87%.
At that after-hours price, Nvidia had surrendered all of Wednesday’s gain and slipped below Tuesday’s $168.89 close. The reversal interrupted a respite after the previous selloff, when the shares fell 5.47% amid mounting scrutiny of Huang and the company’s China business.
New Allegation Involves a Healthcare Executive
Powell joined Nvidia in 2008 and leads its worldwide healthcare business, CNBC reported. Nvidia did not immediately respond to the network’s request for comment.
Wednesday’s allegation concerns a different person from Alice Huang, the former Megaspeed executive at the center of earlier reporting about suspected Chinese espionage. Jensen Huang’s November 8 employee letter acknowledged infidelity without naming the other person and pledged cooperation with the board’s investigation.
Directors Have Hired Outside Investigators
Independent directors said Tuesday they had retained former acting US Attorney Joon H. Kim and Wachtell, Lipton, Rosen & Katz to conduct the investigation announced Sunday.
In its original statement, the board expressed confidence in Huang and his leadership team. Directors said they had no reason to believe national security or Nvidia secrets had been compromised, while committing to examine all available information.
The leadership scrutiny now runs into Nvidia’s next financial report. The company will release fiscal third-quarter results on November 17, followed by an analyst call at 5 p.m. Eastern time.
