Jensen Huang Could Be Removed by Just Six Votes: Implications for Nvidia’s Share Price

A fall of more than 9% in Nvidia shares, later reduced to between 7% and 8%, marked after-hours US trading in the early hours of November 12. Behind the decline was not an earnings disappointment, but reporting by the Wall Street Journal that directors were preparing to dismiss co-founder and CEO Jensen Huang. A meeting to determine his future could take place as early as that day. Further reporting from Bloomberg indicated that an external firm was already helping the board identify prospective successors, while directors considered an interim appointment ahead of a broader search for a CEO.

The events began on November 8 with a letter in which Huang acknowledged to employees that he had been unfaithful to his wife. Directors launched an independent investigation that day, while voicing “confidence” in him and his leadership team. Huang retained the CEO role as the inquiry continued. A report by The New York Times on November 11 alleged a second extramarital relationship, this time involving a company executive, adding pressure for a board decision. Suspected links between the woman in the first relationship and a foreign intelligence agency heightened the sensitivity of the case, alongside questions over compliance relating to chip transshipments. Although directors said there was then no reason to believe national security or company secrets had been compromised, they undertook to examine all available information.

A three-day period had thus taken a founder CEO from acknowledging an affair and declining to step down voluntarily to confronting a vote over his position. Whether such a vote results in his replacement, however, turns on the absence of governance protections that Nvidia never chose to introduce.

Nvidia Leaves Its Founder Exposed Without a Governance “Moat”

Unlike many founder-led Silicon Valley companies, Nvidia does not give its founder enhanced voting rights. Meta and Google, for example, employ dual-class share structures that magnify founders’ voting power and provide considerable protection from board challenges and activist investors. Nvidia has instead kept one class of common stock since its listing in 1999, assigning one vote to each share without special voting arrangements for its founder.

Huang’s approximately 870.6 million shares amounted to 3.58% of Nvidia’s outstanding stock as of March 2026. While this made him the largest individual shareholder, BlackRock held 7.43% and Vanguard 7.31%, both larger stakes. Ownership of 3.58% gives him neither the ability to settle shareholder votes alone nor the power to stop board decisions.

For directors seeking to dismiss a CEO, the mechanism is simpler still: Article 32 of Nvidia’s bylaws permits the removal of any officer, with or without cause, through a majority vote of serving directors. There are currently 11 board members, comprising Huang, the sole non-independent director, and 10 independent directors. He could therefore be dismissed with six votes; his own vote carries no veto.

These arrangements are fundamental to the present dispute. Nvidia’s concentrated founder leadership has sustained strategic continuity for 33 years, without institutional measures to protect that founder against dismissal. As a personal scandal brings Huang’s position under scrutiny, he has none of the structural leverage that Meta’s or Google’s founders can draw upon.

Nvidia Faces a Leadership Gap Without a Named Successor

The procedural simplicity of securing six votes does not resolve the practical difficulty of finding the next leader. A succession plan has not been made public by Nvidia, which has neither a clearly identified deputy nor a chief operating officer. Its long-established flat management structure was illustrated in a public discussion in 2024, when Huang said that 60 people reported directly to him at the time. To Bernstein analysts, the absence of a COO represents a governance vulnerability. The Thinking Machine author Stephen Witt made a sharper observation: there was no clear sign of which person among those 60 might be promoted.

Discussion among analysts and former employees has focused on possible transitional arrangements, not an agreed succession. One option favoured for an interim appointment by D.A. Davidson analyst Gil Luria is CFO Colette Kress. Her tenure at Nvidia exceeds a decade and investors are familiar with her, although her predominantly financial background does not offer Huang’s engineering credentials. A possible longer-term choice is Vice President Ian Buck, who contributed to the creation of CUDA. He is now responsible for the data centre and computing business and works directly with leading cloud providers. These names remain suggestions from analysts and former employees, rather than an official decision: Nvidia has designated no successor.

The difficulty is not confined to identifying someone qualified for the job. Investors have yet to find a way of judging Nvidia’s current valuation and business narrative apart from the personal influence of its founder. Dan Gallagher, the analyst, described it as hard to envisage another person leading Nvidia, with nobody knowing how to value the business in Huang’s absence.

A more favourable reading comes from Dan Niles of Niles Investment Management. Drawing on the company’s talent pool and Apple’s performance after Steve Jobs’ death, he contends that Huang is “not critical” to Nvidia’s development over the next few years. The analogy is valid in some respects, but leaves out the timing of the handover. By the time Jobs died, the iPhone and iPad, Apple’s principal product lines, were established and growing, placing succession within a relatively stable product cycle. For Nvidia, the backdrop is a still rapidly expanding AI infrastructure cycle, heavily dependent on personal relationships with major customers and governments globally. Taking charge on an interim basis would mean sustaining supply chains, customer ties and policy negotiations while contending with an unprecedented competitive race.

Retaining or Replacing Huang Exposes Nvidia to Competing Risks

Directors must weigh two categories of risk at once, making this more than a choice between defending a founder and upholding governance standards.

Leaving Huang in charge entails increasing risk. Investors brought a securities class action against both Nvidia and Huang on November 9, claiming that “deceptive statements” made by the company had denied the relationships before the scandal surfaced and obscured their understanding of business risks. Purchases of Nvidia securities between October 9, 2025, and November 8, 2026, fall within the lawsuit’s scope. The central issue raised by the plaintiffs is whether disclosure of possible national security risks was sufficient. Their allegations concern intelligence connections involving the woman in the first relationship and public denials previously issued by the company that, they argue, misled the market.

A change of CEO presents risks that are less readily measured. The absence of an appointed successor is only one consideration. Another, less conspicuous governance issue concerns the beneficial ownership of Huang’s shares: roughly 801 million of his approximately 871 million shares, equivalent to 92%, are owned jointly with his wife, Lori. Voting and investment authority is shared over these holdings, spread across living trusts, irrevocable trusts and the couple’s foundation. Their joint voting authority continues for as long as their marital status does not change; a change could make reassessment necessary. Although the company’s rules empower directors to dismiss the CEO, they cannot know how that jointly held stock would be voted in the next director election.

Pressure is building beyond the boardroom, too, with several US lawmakers publicly demanding Huang’s resignation. His personal controversy now intersects with the debate on semiconductor export controls to China and proposals to strengthen tracking of chip transshipments. Concerns over AI sector valuations had already driven Nvidia shares down nearly 20% during the preceding month, before the scandal emerged. The controversy has therefore struck at a time when pricing was already fragile.

Alongside GPUs and the CUDA ecosystem sits a further essential Nvidia asset: the informal trust network Huang has established through personal dealings with major cloud providers, governments and supply chain partners around the globe. According to Reuters, Elon Musk and Oracle founder Larry Ellison were among those who contacted him directly for access to scarce AI chips. This network functions effectively because of the certainty that Huang cannot be separated from Nvidia.

That assumption has been unsettled by the scandal, which has damaged credibility on three fronts simultaneously. On a personal level, the issues are the affairs and the initial denials. At the governance level, they are whether directors were misled and whether the independent investigation merits trust. For compliance, the concerns involve suspected foreign intelligence connections and chip transshipments. Taken together, they oblige the market to reconsider the risk premium associated with Nvidia’s governance and compliance.

The same distinction helps account for an after-hours fall of between 7% and 9%, rather than a steeper decline. Neither demand for Nvidia chips nor its order backlog or technology roadmap has been altered by the scandal. The adjustment concerns founder-related governance risk, not the competitive standing of the products. How directors manage those six votes will nevertheless determine the scale and persistence of the valuation discount. A finding that Huang misled the board could cause it to widen quickly. An investigation that finds no systematic concealment, with Huang staying in post, could allow it to narrow in part. Even in that outcome, the prospect of dismissal through six votes could leave a permanent structural discount attached to Nvidia’s valuation.