New York, Nov 13 (V7N)- Shares of US chipmaker Nvidia fell sharply on Thursday following the sudden resignation of chief executive officer Jensen Huang, closing down 4.34 per cent after losing more than 14 per cent at one point during the trading session, CNBC reported.

Nvidia's market capitalisation remained below $4 trillion for most of the day before recovering slightly towards the close and crossing the threshold again. The company's market value has remained above $4 trillion since July 2025.

In a statement on Thursday, Nvidia said Chief Financial Officer Colette Kress would serve as interim CEO until a permanent successor is appointed. Former Synopsys CEO Harvey C. Jones will become the company's first chairman of the board.

Huang's departure comes amid allegations concerning his personal relationships and reported links between individuals associated with him and Chinese interests.

The Financial Times reported that Huang admitted to an extramarital relationship with Alice Huang, an executive at cloud technology company Megaspeed. US intelligence officials reportedly suspect that Alice Huang was involved in espionage activities for China.

Questions have also emerged about her alleged connections with Huawei, one of Nvidia's major competitors in China. In a special report on Thursday, CNBC correspondent Eamonn Javers said Alice Huang might own or hold stakes in several Chinese companies benefiting from Huawei, while also maintaining business relationships with Nvidia.

Separately, The New York Times reported on Wednesday that Jensen Huang had an extramarital relationship with Kimberly Powell, Nvidia's vice president of healthcare, who worked directly under him. A Reuters report on Thursday also referred to his close relationship with another company employee, whose identity was not disclosed.

Before Huang's resignation, several Wall Street analysts told CNBC that his departure could trigger a decline of up to 20 per cent in Nvidia's share price because of his central role in the company's success. Nvidia shares had already fallen by more than 20 per cent over the preceding month.

On Thursday, investment research firm Bernstein cut its price target for Nvidia shares by half, from $400 to $200.

Bernstein senior analyst Stacey Rasgon said on CNBC's 'Squawk Box Asia' that allegations involving a relationship with an employee under Huang's supervision had made it difficult for the board to retain him.

Huang co-founded Nvidia in 1993 and played a central role in transforming the company from a gaming hardware manufacturer into a global leader in artificial intelligence (AI). His strategic decisions over the years were instrumental in shaping the company's position in the rapidly expanding AI industry.

However, analysts say uncertainty remains over who can provide the leadership needed to guide Nvidia through its next phase of growth.

Rasgon said Huang's leadership had been central to Nvidia's success and that it was difficult to identify an immediate successor capable of making similarly consequential strategic decisions.

"Jensen is Nvidia. He is the visionary leader. The company is in the position it is today because of the decisions he made 10 years ago. I cannot say spontaneously who will be the right person to make the right decisions for the next 10 years," he said.

Several US lawmakers had also previously called for Huang's resignation, adding to the pressure on the company's leadership.

Richard Reil, chief investment officer at Questar Capital Partners, said the absence of a clear succession plan had increased the risks associated with investing in Nvidia shares. He said the board faced two difficult choices: retain Huang while he faced months of questioning before congressional committees, or move forward without him.

"Nvidia doesn't have anyone ready yet," Reil said on CNBC's 'Access Middle East', warning that either option could create significant uncertainty about the company's investment outlook.

He added that the developments did not mean the entire AI sector was losing its prospects, but Nvidia shares could become less attractive to investors.

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