Nvidia Falls 8% After Hours as Its Board Reportedly Prepares to Remove Jensen Huang, and European Chip Stocks Slide

By Thursday morning the pressure had spread. Nvidia was down about 7 percent in premarket trading, and the STOXX Europe 600 Technology index fell about 1.3 percent early on, with ASM International, STMicroelectronics and ASML each losing roughly 2.5 to 3 percent, according to Yahoo Finance. Most Asian markets fell too, and Taiwan's Taiex lost 2.6 percent.

Who could replace Jensen Huang at Nvidia?

Nobody has been named, and analysts say the company has no obvious successor. Semafor reported, according to Seoul Economic Daily, that some board members support making chief financial officer Colette Kress interim CEO if Huang goes, and that the board has hired an outside search firm. An analyst quoted by Yahoo Finance said Kress is the most obvious candidate and that Huang could in theory stay in a reduced role.

The board has 11 members, including Huang, and CBS said the others are designated independent in a regulatory filing. Seoul Economic Daily noted that under the bylaws a majority of directors can remove the chief executive without cause, though a final decision could take time. Not everyone thinks it should happen: analyst Dan Ives told CBS that Huang is "not replaceable by another CEO or group of interim executives."

What happens next for Nvidia and Huang?

The background is the inquiry the independent directors opened on 8 November, after reports that Huang was the target of a foreign intelligence effort. Huang has acknowledged an extramarital affair, and the board has said it had no reason at that point to believe national security or company secrets were compromised. We covered the first days of that story in our report on the board's hiring of an outside investigator, and Nvidia's third-quarter results are still due on 17 November.

Until the company says otherwise, the facts are narrower than the headlines: a newspaper report that a board is preparing to act, a market that priced in the risk overnight, and a company that has not spoken. The next signal is either a board statement or Nvidia's regular-session trading in New York later on Thursday.