Dickens: NVDA Can't Replace "Queen Bee" in Jensen Huang, Earnings Litmus Test Ahead

Sam (0:00)

Good friend, Steven Dickens, CEO and Principal Analyst over at Hyperframe Research. Wow, what a week, Steven. How are you thinking about this story as we edge closer to that earnings report? I mean, KG and I were just discussing, we might not get the guidance. I mean, is that a short term negative, do you think?

Steven Dickens (0:17)

I was listening to that in the green room. I hadn't picked that up. If obviously Jensen was required to sign that legal document going into earnings, and if he wasn't around. I mean, Collette would have been involved in that process. I can't imagine that they won't announce earnings, but that could be material to the stock price intraday. I don't think it makes a material difference to the company going forward, but it could provide less guidance on the day, and may impact the reaction to earnings when that gets announced. I mean, I think for me, the first piece is the CEO choice, Collette's been there since 2013

She's going to be a steady set of hands. These numbers were largely baked, and would largely be prepped in order for this type of call next week. So I'm not expecting there to be much bumpiness going into earnings. I think obviously they'll be peppered with a bunch of questions in the post from the equities guys. So I'm expecting a lot of questions around transition plans. Who's in mind for that search? I don't expect the company is the same very much.

Obviously, they're conducting the search and it's still early days, but I'd imagine there'll be a lot of questions.

Sam (1:37)

This is why she is seen as really the best set of hands, as you say, at a time like this, because she is the CFO, she knows the financials, she knows the company inside out. She will be able to speak to the street, given all the really tough and hard questions that are going to be thrown at her on that phone call, no doubt.

But I think the big question is what happens beyond that now, Steven? I mean, there have been so many stabs at who might be next, who could potentially fill Jensen Huang shoes. I saw the FT was out with a piece this afternoon, talking about Rene Haas over at Arm. That's a name that has very much been out there, that's been thrown around as well. I guess the question is whoever it is, beyond this earnings call, how much time do you think they have to find this person? I mean, how willing and patient do you think the market is going to be?

Steven Dickens (2:32)

Well, so a couple of points to that, Sam. I think the first big conference of the year is CES. Jensen would have been slated to be on stage and been working with a bunch of the peers. I know Lenovo were going to be there, Dell will make announcements, HPE, HPE, all of the big players would be making announcements. Jensen would have been there rocking his biker jacket and would have been the rock star show. So the first big event of the year would be CES. If they can get somebody in place by there, I think that's the perfect showcase.

Then looking for a replacement. I don't think Nvidia needs one person. I think they need a strong chair. I think they need a chief executive, and then they need a COO. Chatting to people at the company this week, Jensen had 60 direct reports. Large parts of that organization don't have job titles.

It's a real hive. I was chatting to the guys at Axios, and they quoted me on this earlier this week.

It was a hive mind, and Jensen was the queen bee. I don't think you can replace one queen bee with another queen bee. I think I like the structure of what Oracle's done after Larry left an executive leadership role there and have really put a co-CEO in place. I'd like to see more prominent faces taking roles rather than a concentration of power into one person. I think it's almost unreasonable to ask somebody to take on all of the roles that Jensen used to have. Chief Evangelist, Chief Salesperson, Chief Government Relations Officer, Chief Executive, Chief Innovation Officer. He had all of that. He was an N of one, maybe only Elon and Mark Zuckerberg over at Metta are sort of in that same ilk. I think trying to replace one of those characters, almost impossible. I'd like to see them hunting for maybe three roles, as I say, that chair of the board and have an independent chair that's not good executive day-to-day role, a CEO and then a really strong COO who gets down into the operational mechanics of the business.