Transcript of What Jensen Huang’s Potential Ouster Could Mean for A.I.

From The New York Times, I'm Michael Barborough. This is The Daily. New reporting from The Times has put the future of Jensen Huang, the CEO of NVIDIA, and the man at the center of the AI revolution in growing doubt. Today, my colleague Trip Mikkel walks us through the latest revelations about Huang's conduct, the difficult decision now facing NVIDIA's board, and what Huang's ouster could mean for the future of artificial intelligence.

This has moved much faster than anybody expected it to. And I'm surprised to be back as well.

Well, it's moved fast in part because of you and the reporting you and our colleagues are doing. And at this moment, at 12:30 a.m. Eastern Time, NVIDIA's directors are finishing up what may be one of the most closely watched emergency board meetings in corporate history, and they are sorting out the fate of the company's CEO, Jensen Huang, a future that now appears to be in grave, grave danger. And I know that things might change by the time our episode publishes at 6:00 a.m.

We know that 10 people who are serving on this NVIDIA board that have been there a long time are wrestling with a decision they never thought they would have to make. And that's whether or not Jensen Huang should not only continue to lead the company, which our reporting suggests will not happen, but should even have a role at the company going forward. This is a company he co-founded in a Denny's in 1993. So it's really an unimaginable moment for this group of 10 people.

And from what you're saying, they are leaning towards an outcome in which he is no longer chief executive officer of the company he founded. This company, not an overstatement to say, is at the heart of the AI boom, the heart of the AI revolution, the heart of the global economy.

Yes. They are leaning towards an outcome that would take the man who has very much become the face of AI around the world, who's perceived to be the maestro of artificial intelligence, and removing him from leadership of the most important company in the AI movement.

Okay. Well, tell us how this seemingly unimaginable outcome just a few days ago, when you were on the show talking to my co-host Natalie Kittchereff, you said that Jensen Huang's future seemed relatively safe. How do we get to this point where it's now in such serious doubt?

In recent days, and really more than a week, we've been tracking a tip that Jensen Huang had had a relationship with an executive at the company, one of his direct reports.

That would basically be a second romantic relationship with somebody, in this case, a colleague.

In this case, it would be a second breach of the company's code of conduct to come to light in a matter of days. The first being a breach of the code of conduct for having an intimate relationship with a supplier, the woman who we've written about extensively, Alice Wong at Megaspeed, who U.S. intelligence has determined is a Chinese spy.

Right.

This would be a totally different thing. And on Wednesday morning, my colleagues Ryan Mack and Georgia and I decided that we had enough reporting to move forward with a story about this second intimate relationship.

Okay. And tell us about who this woman is who Jensen Huang had, according to your reporting, this intimate relationship with, this second woman.

The second woman is an executive on his leadership team. Her name is Kimberly Powell. She leads their medical and healthcare group. Kimberly's been with the company since 2008. She is often traveling with Jensen and his entourage at conferences and events and things like that. And according to our reporting, at their recent annual conference in San Jose, the two of them were in an affectionate moment that someone caught on camera with their phone, and that NVIDIA's security came over and got the person to sign an NDA over that moment of affection.

So the company's security team would have understood that somebody noticed Jensen Huang and this female executive in some sort of moment that felt perhaps not quite right, and asked someone to sign a document saying that they would never share that information with anybody else.

That's right. That's right.

And this executive, presumably, since Jensen Huang is the CEO, somehow reports to him. What exactly is their relationship?

She's one of 60 direct reports at the company who report directly to Jensen Huang. And as we all know in the world of HR, one of the kind of cardinal sins in the HR world is you don't have a relationship, a close relationship, with somebody who directly reports to you.

Right. In fact, most companies expressly forbid this kind of relationship because of the power dynamic at play, with a boss being obviously capable of, in theory, coercing a subordinate into a romantic relationship. Do we know if NVIDIA has that kind of expressly forbidden policy?

We know that their code of conduct says that employees at NVIDIA are supposed to, quote, "avoid situations where our actions create conflict, including, quote, personal relationships." And the company states that it promptly investigates any reports of that kind of misconduct.

Okay. So did this relationship make its way to NVIDIA's leadership before you found out about it?

Not that we're aware of.

Okay. So once the company learns, presumably through your reporting, about this relationship, what do you understand to have occurred?

What I understand played out after that is that after the company got our inquiry and knew that we were moving forward with a story, that the board was notified. And fast forward, they're having a meeting by the end of the day to discuss and deliberate over whether or not Jensen Huang should continue to lead the company.

Help me understand why this requires so much deliberation. I have been a business reporter, and in that time, I watched CEO after CEO after CEO, from McDonald's to BP, be pretty much summarily fired for this very kind of relationship with a subordinate.

Yeah. Why does it cause this much deliberation? I mean, this company is Jensen Huang, right? I mean, it is built around his leadership, his vision, and the structure of the company makes it such that there's not a clear successor at all either, right? When you have 60 people reporting to you, yes, you can pull somebody from those ranks, and they could lead the company in his absence. But this isn't something like, take, for example, I used to cover Apple for a lot of years.

You're saying, to the degree that the board has gotten to the point where it may be ready, and perhaps already is ready, to push him aside and knock him off as CEO, it has been probably pained and reluctant and agonizing as it gets there.

It has to come to terms with a possibility that no one on this board ever thought would be a reality. I mean, this is a monumental decision for this board. And he's been on a rocket ride the past three years. He could literally do no wrong until all of a sudden, all this problematic behavior spilled out into public view.

Right. And what may be fascinating, if in fact Jensen Huang is ousted as CEO, is that after digesting the fact that he had had a romantic relationship with a, according to U.S. officials, Chinese spy who funneled information back to the Chinese government, it may end up being this other, second relationship with an employee, not a spy, that may end up costing him his job.

Yes. And I think part of the problem here is the board is dealing with a one-two punch that must make them wonder.

If this is not necessarily the end of the story.

Yeah.

Yeah.

Which is a troubling thing to ponder. They're making the most complicated and most important technology of our time. That is like, not just important to them, and not just important to the economy, and not just important to OpenAI down the street to my right, and Anthropic down the street to my left, but also important to the U.S. government and the potential and prosperity of the U.S. economy. These are the rails on which artificial intelligence runs.

We'll be right back. Trip, let's envision a world in which Jensen Huang is no longer the CEO of NVIDIA. Just walk us through the scenarios in which that happens. Does he somehow remain at the company? It sounds like the board would like to find a way, perhaps, for that to happen. There isn't a huge succession plan written anywhere.

We are in such uncharted waters that this is an impossible question to answer. And I am so glad I'm not one of those 10 people. I mean, let's just do analysis here, right? And just what we know about this circumstance. If he stays, and they conceivably do a search to find a new chief executive to lead the company long-term, and they install an interim to help the company navigate the next several months while that search plays out. If he's still there, who is everybody at the company going to look up to?

It would be him, not the interim CEO.

Right. So it could undermine the standing of the interim CEO. It could create challenges for any incoming CEO and for the search process, right? Well, what's Jensen going to be doing? Is he still going to be there if I take this job or not? And then there's also the question of trust, right? The reason that this has become an issue of trust is that when we did our first report about U.S. surveillance discovering that Jensen had a close relationship with this woman who was a Chinese citizen and the executive at the Singaporean data center firm, Jensen went to Bloomberg News and told them on the record that it was just a normal business relationship.

That has turned out not to be true, yeah.

That proved not to be true. I mean, he sent an email to the entire company telling them that he'd had an affair and been unfaithful to his wife. That was in the span of, I don't know, less than two weeks.

That would seem to be the case for a clean break, perhaps.

Yeah, it would. And we haven't even talked about the implications for Washington and NVIDIA's position on selling chips to China and the U.S. government policy on that, which has been moved in the direction that Jensen Huang wanted, which was permitting and allowing the sale of some chips to China. You and I know we've talked about this many times over the past couple of years. He has a contrarian view of what the U.S. government's strategy should be relative to what many people in Congress believe and what a large faction of the Trump administration believes.

Right. And his view has prevailed. He's persuasively argued to the Trump administration that those chips should be sold to China. I'm guessing where you're headed here, Trip, is that if Jensen Huang has suddenly gone entirely from NVIDIA, the most powerful, persuasive proponent of that case for selling chips to China might not be making that case anymore. Perhaps that policy changes.

Exactly.

Well, this makes me want to ask about President Trump. We've talked a lot about Jensen Huang's very close relationship with the president. And I wonder how that closeness might influence what comes next. It doesn't seem entirely outside the realm of possibility that President Trump might want to put his finger on the scale of this board's deliberations as it figures out what to do with Jensen Huang.

Given NVIDIA's importance to the economy, given President Trump's personal relationship with Jensen Huang, you can almost rest assured that there is a truth social post in our future with the president weighing in on the outcome of this board's decision. One of the questions we found ourselves asking is, is there a world in which or a mechanism through which the U.S. government could take an interest in NVIDIA? We've seen it do that with another chip company as well.

A financial stake in it.

Yeah, financial stake. We saw that a year ago with Intel. The U.S. government now owns 10% of Intel. Now, it was able to do that because it had already made a commitment to pay Intel about $10 billion for building out manufacturing plants in the U.S. And it just kind of pushed that money forward earlier than it would have otherwise. We don't know what the mechanism would be here, but we know this is an administration that likes to have skin in the game and is willing to be active in taking stakes in companies.

Just so I understand, and my listeners can understand, for President Trump, who so very much likes Jensen Huang and presumably wants him to stay on as CEO, what would a U.S. government financial stake in NVIDIA do to advance that? Or would it have nothing to do with whether Jensen Huang stays on? It would just be to try to make sure the company remains healthy even without him.

It would be a sign to the market that this company has the full faith and backing of the U.S. government. You know, I don't want to get into like Wall Street jargon here too much, but when there is a growing sense that Jensen may not be leading this company going forward, one of the leading semiconductor analysts on Wall Street cut what is called a price target where he thinks the stock could go based on its performance from $400 to $200, which is only $27 above where NVIDIA is trading at the moment.

What are the next steps for NVIDIA's board? And when do you expect to know for sure what Jensen Huang's face is going to be?

The next step for the board is to make this immediate decision in terms of how it's going to set up the structure going forward in terms of the leadership structure. It also has to fulfill its promise to investigate Jensen Huang, and it needs to proceed with that investigation. They hired a lawyer earlier this week from Wachtell Lipton to do the investigation. He's an experienced investigator, so that will need to proceed. And they'll presumably need to run an executive search process and select a new CEO for a chip company, which is not an easy thing to do.

Right. You're saying it's not at all clear who would take Jensen Huang's place long-term. It doesn't sound like the board necessarily has much of a list.

No, no. I mean, I think they'd be starting from scratch.

If Jensen Huang is completely forced out of his company, is there any real risk that it impacts the future of AI, that him not being there slows this company's production of these chips and therefore slows the pace of U.S. supremacy in AI?

The companies that do business with NVIDIA who I talked to about this dilemma, like what happens if Jensen's not there, say that the leadership ranks at NVIDIA are solid and strong and that there can be continuity at this company, that it can continue to crank out the kind of chips and technology that we're accustomed to seeing from it with or without Jensen. But it is going to take somebody to come in and look at the leadership structure and reorganize it in a way that can work with a different CEO.

Well, that brings me to my final question. One thing in this whole saga feels quite certain, which is that NVIDIA's board did not plan for this day and did not push Jensen Huang to plan for this day where he might be in serious trouble and this judgment would be called into question and that they might need to get rid of him. And that is the job of a board of directors, to come up with that kind of succession plan. And so are we learning that NVIDIA, for all its success and its extraordinary influence and place in the global economy, wasn't quite ready to be the company that it has become in our global economy?

Yes. And making matters worse, in addition to not having the internal structure to get through some of this easily, is the fact that the company has put themselves at the epicenter of the entire AI boom. I mean, they have been investing in startups. They have been funding data center buildouts. They have been backstopping financiers who are helping build data centers. They have been putting their foot on the gas and making this entire thing go.

AI agents going rogue.

AI agents going rogue, data centers not being built because of moratoriums and policy. What if it actually all comes down to one executive's poor judgment?

Well, Trip, get some sleep and we'll talk to you soon. Appreciate it.

Thanks so much.

By Thursday morning, shares of NVIDIA fell by around 8% in what's known as after-hours trading as investors absorbed the possibility that Jensen Huang might be ousted as the company's CEO. We'll be right back.

God didn't want us to get it the easy way. He wanted us to get it the Mississippi way.

On Wednesday night, after more than a week of vote counting, Democrat Scott Caloum was declared the winner of the U.S. Senate seat in Mississippi, making him the first Black senator from the state in nearly 150 years and the state's first Democratic senator in decades. His narrow victory over incumbent Republican Cindy Hyde-Smith highlights just how much success Democrats had this year in heavily Republican states, including Texas, Iowa, and Kansas.

It's not something that I did, y'all. It's something that we did. All I did was have the courage to imagine a night like this. I had the courage to believe in Mississippi. I had the courage to understand that we could show the country that Mississippi matters.

Today's episode was produced by Diana Wynne and Eric Krupke. It was edited by Mark George, contains music by Dan Powell and Marion Lozano, and was engineered by Alyssa Moxley. Our theme music is by Wonderly. Special thanks to Aaron Griffith.