Jensen Huang has resigned as Nvidia CEO, and CFO Colette Kress is interim chief. President Donald Trump says Apple's Tim Cook should take the job, while analysts cut price targets and rivals and Nvidia-backed stocks moved.
Nvidia CEO Jensen Huang is stepping down as chief of the chipmaker he co-founded 33 years ago and built into a $4 trillion company. CFO Colette Kress has been named interim CEO, and the board will search for a permanent successor among internal and external candidates, according to the company's release.
The exit follows a series of reports about Huang's romantic ties to a woman believed by the U.S. intelligence community to be a Chinese spy. Huang apologized on Sunday for being unfaithful to his wife, without giving details.
Trump backs Tim Cook for the job
Trump quickly weighed in on Truth Social. He wrote that only one man should take Huang's place, Apple's Tim Cook, adding: "A Legend replaces a Legend!"
Prediction markets reacted. Bets on Cook becoming Nvidia's next CEO briefly peaked at 91% and later settled around 10%, according to Crypto Briefing. That outlet also notes that Nvidia's board, not the White House, decides who runs the company.
Analysts cut targets as the stock slides
Analysts have been slashing their price targets since the revelations, with at least 10 Wall Street analysts turning more bearish this week, according to FactSet. Stifel lowered its target to $205 from $315 but kept its buy rating. Baird cut its target from $500 to $200 and downgraded the stock to neutral.
The stock was trading about $160 at the time of CNBC's report. Michael Landsberg of Landsberg Bennett Private Wealth Management said the stock is now pricing in a leadership discount. Janus Henderson's Jeremiah Buckley took the other side, arguing the resignation could be a clearing event for the company.
Rivals and Nvidia-backed stocks move
Shares of Intel and Marvell both slumped more than 4% after the announcement, and Synopsys fell 3%. Nvidia has invested in all of these companies.
Rival AMD moved the other way. Its shares were up nearly 17% since Monday, when markets opened to news of Huang's affair with an alleged Chinese spy. Daniel Newman of the Futurum Group cautioned that AMD cannot instantly ramp up massive additional volume even if customers move its way.
Congress is still waiting on Huang as well. House Foreign Affairs Chair Brian Mast said Huang is willing to testify as soon as next week.
Sources: CNBC, Crypto Briefing
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