Jensen Huang's looming ouster triggers an AI earthquake
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Jensen Huang's potential ouster from Nvidia has plunged the AI industry into uncharted territory — a corporate earthquake that dwarfs even the chaos unleashed by Sam Altman's temporary firing from OpenAI in 2023.
Why it matters: Nvidia is the backbone of the global AI economy, with its chips, investments and financial guarantees sustaining an entire ecosystem of companies worth trillions of dollars.
- At the center of that vast financial flywheel is Huang, who spent 33 years making himself synonymous with Nvidia — and Nvidia synonymous with the AI revolution.
- "This is no ordinary CEO. This is no ordinary company. This is no ordinary sector. This is no ordinary time," economist Mohamed El-Erian wrote on X, warning of contagion across the AI industry.
Zoom in: As recently as two weeks ago, the notion of Nvidia without Jensen was unthinkable.
- Even after his affair with a suspected Chinese spy came to light, President Trump and Nvidia's board stood behind him, Silicon Valley's elite rallied to his defense and betting markets suggested he would survive.
- It took revelations of a second affair — this time with an executive who reported directly to Huang — to shatter that consensus and bring his storied reign to the brink of a stunning end.
Driving the news: After that second affair came to light Wednesday night, Nvidia's board reportedly met to settle Huang's fate, though there was still no decision as of early Thursday morning. The White House was read in.
- The market reaction has been brutal. Nvidia had already shed more than $1 trillion in market value since the initial scandal erupted, and shares plunged further in after-hours and pre-market trading overnight.
- One of Wall Street's most prominent voices on tech, analyst Dan Ives, said Nvidia was worth 25% less without Huang.
Zoom out: Huang's rise was the stuff of Silicon Valley legend: The Taiwanese immigrant went from cleaning toilets at a Kentucky boarding school and waiting tables at Denny's to building one of the most valuable companies in history.
- Huang and two fellow engineers hatched the idea for Nvidia at a Denny's booth in 1993, launching a chipmaker that would revolutionize gaming, transform modern computing and ultimately power the AI revolution.
- Clad in his trademark black leather jacket, Huang became a global AI rock star — with a cult of personality that drew adoring crowds, calmed markets and commanded the attention of world leaders.
The big picture: Huang's apparent downfall comes amid mounting anxiety over the AI industry's future, as new financial, political and regulatory risks threaten one of the largest infrastructure buildouts in history.
- The timing is especially fraught for Anthropic, whose historic IPO — backed by a $10 billion commitment from Nvidia — looms as a referendum on Wall Street's faith in the AI trade.
- Huang spent years defending the industry's soaring valuations and dismissing warnings of a speculative frenzy. Now his own scandals could help burst the bubble he insisted didn't exist.
What to watch: The blast radius could extend far beyond Silicon Valley and Wall Street, threatening to engulf the Trump administration in a scandal over its handling of sensitive technology exports to China.
- Huang forged a close alliance with Trump and Commerce Secretary Howard Lutnick, who loosened restrictions on chip sales even as other officials raised concerns about Chinese espionage and smuggling.
- Top Senate Democrats are already demanding that Lutnick and other senior officials preserve records of their dealings with Nvidia and Huang, laying the groundwork for a sweeping investigation.
The bottom line: As veteran China watcher Bill Bishop wrote after Huang acknowledged his first affair: "There is rarely just one lie."
