Nov 9 (Reuters) – Nvidia’s board is probing whether CEO Jensen Huang was the target of a foreign intelligence effort, following a media report alleging that he had a close relationship with a Chinese businesswoman who passed information to Beijing.
Here are comments by analysts and prominent figures:
RYU YOUNG-HO, SENIOR ANALYST AT NH INVESTMENT & SECURITIES:
“It appears the US government had been aware of the matter involving Jensen Huang for several months, so the immediate impact is unlikely to be significant.
“The biggest potential risk for South Korean companies would be if a prolonged investigation or internal review were to lead Nvidia to delay its investment decisions.
“If Nvidia’s product shipments or launches were to be delayed, it could have broader implications for the semiconductor industry.”
GARY BLACK, TESLA INVESTOR WHO MANAGES MONEY FOR THE FUTURE FUND LLC:
“I doubt Jensen Huang will be able to remain as (Nvidia) CEO. This could put short-term pressure on the stock of the second most valuable company in the world.
“He has no natural successor within the company. While Huang has not committed any crime or tort, his code of conduct and judgment will be called into question, which will likely result in his removal …
“Many portfolio managers will reduce their (Nvidia) holdings in the coming weeks as a result of uncertainty over who could succeed Jensen.”
US PRESIDENT DONALD TRUMP:
“I have not spoken to him about it. I just know he’s a fine person, but you never know what is going on. I hope everything’s fine … I think he’s an honourable guy.”
BILL ACKMAN, PERSHING SQUARE CEO:
“I am not suggesting he gets a free pass. If indeed this is more than an affair, then it is obviously a real problem. I like the guy. He has done a lot of good for the world and I hope the damage here is minimal. That is, I am hoping for a simple affair, not a risk to our national security.”
MOHAMED A. EL-ERIAN, FORMER PIMCO CEO:
“While Nvidia has sought to reassure us all, there are several layers here, beginning with the unfortunate timing.
“For example: The company is systemically important for tech, markets and the economy; Investors tend to struggle to price in key-person and governance issues; and there are fluid national security and geopolitical dynamics.”
SHAUN MAGUIRE, SEQUOIA PARTNER:
Maguire said Huang “did something incredibly dumb” that was “bad for America” but that “Jensen is irreplaceable for America’s AI leadership”.
Tesla CEO Elon Musk commented, “I agree” to the post.
JOSH GILBERT, LEAD ANALYST AT ETORO:
“This boardroom storm has landed at a brutal time for the AI trade, but Nvidia’s earnings on November 17 are the real next test.
“While the investigation is likely to dent sentiment, it won’t alter anything long-term, unless it leads to a change at the top, at which point it becomes a completely different ball game.”
CHRIS WESTON, HEAD OF RESEARCH, PEPPERSTONE:
“Will Huang get replaced? No, I don’t think that’s going to happen.
“I think given that he is like the godfather of AI and, you know, the OG of what has been the biggest investment thematic that we’ve seen in a generation, I mean, I think if we genuinely thought he was going to step down … the stock would be down – it would be an absolute bloodbath, to be honest.
“If it is found out that she’s confirmed as a spy, then, crikey, it doesn’t go well.”
ATIF MALIK, CITI ANALYST:
“For investors, key issues are likely potential governance implications, increased regulatory scrutiny and export-control compliance of the flow of H200 chips into China (<1% of DC sales) and routed through other intermediaries, and (long-term) impact on leadership stability."
(Reporting by Sumedha Mukherjee, Tom Westbrook, Brenda Goh, Danilo Masoni, Heekyong Yang and Jeanny Kao; Compiled by Anne Marie Roantree; Editing by Jamie Freed, Clarence Fernandez and Louise Heavens)
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