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Nvidia's Ex-CEO Out Amid Affair Scandal
13 Nov
Summary
- Former CEO Jensen Huang resigned following affair allegations.
- Nvidia shares dropped significantly after the news broke.
- Longtime CFO Colette Kress is now interim CEO.
Former Nvidia CEO Jensen Huang resigned on Thursday amidst revelations of affairs with employees. These allegations, including a relationship with an executive suspected of spying for China, have put Nvidia's future at risk, according to Jim Cramer.
Shares of Nvidia declined over 4% on Thursday, extending their year-to-date losses to 12%. Colette Kress, the company's long-serving CFO, has been named interim CEO. Cramer suggested that Kress's leadership could foster a more disciplined approach to capital allocation, potentially benefiting shareholders.
Investigations into Huang's conduct are ongoing, with potential implications for Nvidia's international business and market dominance. Competitors like AMD are gaining ground, prompting Cramer to advise caution and suggest taking some profits on Nvidia stock.
Despite the leadership turmoil, Cramer highlighted Nvidia's strong underlying business, substantial cash reserves, and engineering expertise. He drew parallels to Apple's successful leadership transition, expressing belief in Nvidia's ability to thrive even without Huang.
