Nvidia’s Jensen Huang resigns

0:00This is TechCrunch.

0:30or if we're headed towards the movie Gattaca, where gene editing runs amok. So much to learn on the topic. When you want to know more about science, technology, and life around you, check out the Swiss Connection podcast. Hosted by Joe Fahy, it takes a deep dive into science and tech, examining the discoveries being made in Switzerland and their impacts across the globe. Every episode explores the big questions. How researchers are tackling global challenges? What forces are reshaping technology in society? what realities we're facing with AI, medicine, and our climate, and with special guests like structural biologist Michael Hall and cybersecurity expert Clémence Poirier.

1:07The Swiss Connection blends cutting-edge research with clarity, insights, and everyday life, so you can make sense of what's going on. If you're fascinated by innovation, climate science, or the ideas driving tomorrow, this is your gateway. Listen and subscribe to The Swiss Connection wherever you get your podcasts. You know you don't have to wait to shop Black Friday at Lowe's, right? Save up to$150 now and select power tools, equipment, and accessories. Got gifts to get? We've got plenty under$50. Plus, MyLowe's Rewards members get same-day delivery for free. Shop Black Friday deals before the rush at Lowe's.

1:45Valid to 1118,$25 minimum, and loyalty membership acquired. Order eligible items by 2 p.m. Subject to weight and size restrictions and availability. Terms at Lowe's.com slash shipping terms. NVIDIA's Jensen Wong has resigned. So, now what? I'm Imran Shaikh and your Friday Daily Crunch starts right now. Jensen Wong has resigned from his position as president and chief executive of NVIDIA, the company said on Thursday, just a few days after he admitted to a romantic affair with an alleged Chinese spy sparking a U.S. national security crisis. In a regulatory filing, NVIDIA said its board accepted Wong's resignation on Wednesday.

2:23NVIDIA said its current chief financial officer and executive vice president, Colette Kress, will take over as interim CEO until the company finds a permanent successor. Kress will continue to serve as the company's CFO. NVIDIA's shares were down nearly 12 % in early morning trading on Thursday. Since Friday, the company's stock has fallen over 19%, resulting in a market cap loss of more than$855 billion. dollars. Wong founded NVIDIA in 1993 and has led it as CEO ever since. NVIDIA essentially invented the graphics processor unit, a specialized chip that takes care of graphics processing for PCs as we know it today, bringing together transforms, lighting, and rendering into one chip.

3:06The chips were not an immediate hit, and the early days of NVIDIA were characterized by struggle and layoffs, but eventually, it struck on a GPU design that performed so well, It became the standard for graphics processing. These chips also turned out to be extremely good at doing maths, which has made them popular for computation-intensive tasks like crypto mining, and, more recently, training and running neural networks, which are what AI models are at their core. After AI researchers began using GPUs to train neural networks over a decade ago, Wong leaned in towards developing chips for AI and then data centers, and grew it from there into its dominant position.

3:45The potential implications of Wong's departure for the AI and data center industries are vast, given how active Wong, and by extension NVIDIA, has been in furthering the AI boom. In particular, it raises questions about the future of NVIDIA's sprawling AI investments, which have helped bankroll everything from startups developing new technologies to the enormous data centers needed to run them. Under Wong, NVIDIA deftly used its financial muscle to support companies buying its chips, effectively helping to finance the market for its own products, as well as lobbying Washington to relax potential rules around AI and data center regulation.

4:25As of the end of its second quarter, NVIDIA reported$99 billion worth of investments and another$25 billion of commitments. It also has$36 billion in cloud service commitments, which are arrangements that help AI cloud operators finance the GPUs and data center equipment they buy from NVIDIA, with the chipmaker saying it will buy compute from them and potentially earn a share of their operator's revenue. NVIDIA has also been investing directly in NeoClouds, the company's serving a lot of the AI processing needs. In January, the company invested$2 billion in CoreWeave and another$2 billion in Nebius in March.

5:03The chipmaker was said to be considering being a guarantor for N-Scale's planned West Virginia data center project. It's also signed up to provide up to $105 billion worth of credit guarantees for an OpenAI data center campus in Ohio. NVIDIA is also a major investor in the labs building the AI models that run on its GPUs, putting$30 billion into OpenAI and$10 billion into Anthropic. It's also backed Mira Mirati's Thinking Machines Lab as part of a deal involving at least 1 gigawatt of its Vera Rubin GPU systems. The chipmaker has even invested$3.5 billion in MediaTek to help the Taiwanese company develop custom AI chips that work with NVIDIA's systems.

5:46Investors were already uneasy with the enormous amount of debt companies in the space were raising to sustain the AI infrastructure build-out, and Wang's exit throws another uncertainty-shaped wrench into the works. CoreWeave's shares were down about 9 % on Thursday, reversing part of a 25 % rally on Wednesday, while Nebius is down about 16%. IREN fell 6.6%. NVIDIA's board has also appointed Harvey Jones, a managing partner of SquareWave Ventures and former CEO of Synopsys, as the company's first-ever chair of the board of directors. Jones has been on NVIDIA's board since 1993. Wong is the single largest personal shareholder at NVIDIA, but he owns only about 3.5 % of the company's shares.

6:30And unlike most of Silicon Valley's tech giants that were founded far later, he does not hold super voting rights. That means that the board had the power to vote him out at any time. Even if Wong is pushed out as CEO, the board members he has made very rich are unlikely to cut him loose entirely. Barring another shoe dropping, they could keep him on as chairman, a role NVIDIA doesn't currently have. But someone still has to run the company, and there's no apparent succession plan, which leaves us, like everyone else, to speculate while we wait to see what happens next. Likely candidates to replace Wong include Eric Schmidt.

7:06He was the pick of Jeffrey Sonnenfeld, Senior Associate Dean for Leadership Studies at the Yale School of Management, who we talked with earlier this week. Schmidt could parachute in tomorrow and do a very good job, Sonnenfeld said. He ran Google from 2001 to 2011, chaired the National Security Commission on AI from 2018 to 2021, and now runs the rocket company Relativity Space. Intel CEO Lib Bhutan knows chips, and right now he might welcome a very soft landing. Last month, Intel reported third-quarter revenue up 21 % to$16.5 billion, then warned its fourth-quarter results would fall short of Wall Street's forecasts.

7:44Now, if the board feels strongly about having a builder at the helm, they could do worse than NVIDIA VP Ian Buck. He helped develop CUDA, the chip software that has become central to NVIDIA's dominance in AI. Analysts and former employees have floated him as a possible successor, and Calci traders give him a middling shot. And someone else down the hall, Andrew Bell, NVIDIA's senior vice president of hardware engineering, arrived 25 years ago as a fresh Cornell grad and has been on an upward trajectory at the company ever since. And the wild card? Well, Lori Huang. Now, nobody has floated her, but hear us out.

8:23Jensen met his wife as lab partners at Oregon State, so she has been working with him since before NVIDIA existed. After graduating, she worked at Silicon Graphics as a microchip engineer, making more money than her husband, he has said, then scaled back to raise the couple's family, and she now co-leads the family trusts. If the board wants continuity, they could do worse than a humbler Wong, who is also a brainiac. There's a reason, they say, that behind every great man is a great woman, and vice versa. Whatever does happen next, we'll for sure know soon. And folks, that's your Daily Crunch.

9:02Today's stories were reported by Ram Iyer, Connie Loizos, and more awesome TechCrunch journalists. We'll see you here tomorrow. Same Tech Time, same Crunch channel. And until then, find us at TechCrunch.com.

9:35that understand them. Tune in for insights and a long-term perspective on investing and, of course, stock ideas, plenty of them. To quote a listener, it pays to listen. Check us out and subscribe wherever you listen to podcasts.