Fortune: AI’s $5.7 Trillion Giant Faces a Downfall After Jensen Huang’s Exit

A triumph turns into turmoil

In October, Huang appeared in West London during a European tour, telling startup founders Nvidia would invest in them. At the time, the company was the default supplier of chips powering AI growth, and its market value had at one point exceeded $5.7 trillion.

Three weeks later, the trip looked less like a victory lap. Huang resigned on Thursday morning, after reports tied him to Alice Huang, a former Megaspeed executive whom U.S. intelligence agencies reportedly believed had worked as a Chinese intelligence asset. The two are not related.

Reports and company response

Within a week, Huang sent a memo to Nvidia’s 42,000 employees acknowledging he had been unfaithful to his wife and saying he was deeply sorry. Nvidia’s board began an independent investigation, congressional leaders summoned him, and federal agencies said they were investigating. Nvidia shares fell as prediction sites took bets on whether he would step down.

The New York Times then reported allegations of a second affair, involving an Nvidia executive who reported directly to Huang. Nvidia announced his resignation and appointed chief financial officer Colette Kress interim CEO, without stating why he left.

Nvidia’s reach across AI

Nvidia’s position extends beyond chip sales. The company said it had invested nearly $50 billion in leading AI model companies as of the end of July, with equity investments across the AI ecosystem totaling twice that amount.

Pressure on the AI boom

Critics say Nvidia’s investments create a circular pattern: the company funds AI firms and data center operators, which then buy its chips. They argue that this role can hide weak demand, inflate a financial bubble and leave the wider industry vulnerable to a single company’s troubles.

The AI boom also faces concerns about rising interest rates, warnings about severe AI risks and opposition to data centers among Americans, visible in November’s midterm elections. The article says Nvidia’s core business is not going away, even with Huang no longer serving as CEO.