Nvidia Reels From Huang Exit as Microsoft Battles Outage

SPEAKER_1 (0:02)

Bloomberg Audio Studios, Podcasts, Radio, News. Bloomberg Tech is live from the heart of Silicon Valley with Ed Ludlow in San Francisco.

Ed Ludlow (0:22)

This is Bloomberg Tech. Coming up, the fallout from Jensen Huang's resignation as Nvidia CEO continues as more details are revealed. Plus Microsoft races to restore services after a global outage impacted government offices, traders and businesses worldwide. And Anthropic takes its IPO pitch to Wall Street as CEO Dario Amodei sits down with JPMorgan's Jamie Dimon today, head of a blockbuster IPO. We continue to talk about Nvidia and Jensen Huang's resignation more than 24 hours ago as CEO. The stock is down 14% this week. That puts it on track for its biggest weekly drop since January of 2025 Things could have been worse at one point. Just after that resignation was announced, the stock was down 14% at the open in Thursday's session, and it was headed for its worst week since 2009 That's the severity of what we're talking about for the world's most consequential AI company. Curiously, the NASDAQ 100 is up on the week, about three percentage points and on track for its best week since September.

Just a few days ago, no one would have told you that the world's most important technology company on a waiting basis on these indices would be down that much, and technology stocks overall would be that buoyant. A lot has happened. I want to bring in Bloomberg's Ian King, who leads our coverage of the company and of the space.

Last night, you published a story with colleagues about the events of the last 48 hours. What was happening behind the scenes? Could you just summarize the point Wednesday night, I think it was, that Jensen Huang conceded and said this is it?

Ian King (1:59)

Yeah, I mean, it's important, I think, to stay focused on the fact that right up until the end, he really did not want to accept this. This company is essentially him, and he is that company in many regards, and he was not going easily. He was trying to find a way out of the situation, and we're led to believe that the board essentially wanted to support him in that effort. But frankly, things just got to the point where it was untenable, and he had to go, and this is really what happened.

Ed Ludlow (2:25)

That was Wednesday night, and we'd also done that reporting Wednesday night about how the board had already gone to a headhunter and looked for external candidates and was considering an interim CEO, and all told, collect Crest, the CFO is interim CEO. My understanding is that earnings go ahead Tuesday, as they would normally, with analyst questions, et cetera.

Jensen Huang has, however, reflected in the past week, maybe even further back than that on his behavior. What did we report on that?

Ian King (2:54)

Yeah, I mean, in his letter that we had on Sunday, he didn't seek to absolve himself of any blame at all. He apologized to everybody involved, So, we're starting with Jensen Huang, and we have to separate his personal reflections and his reflections on his personal behavior from what that means for this company, and in effect for all of us investors, and also for this company's future in terms of how it goes forward, and any and all legal and political consequences it may face as a result of his actions.

Ed Ludlow (3:26)

On that, the headlines this morning are that Congress, a coalition of different parts of Congress, has sent another request for him to speak. We were told... Yesterday, he had accepted the invitation to speak for Congress, but they've added Nvidia's General Council and also representation from the Commerce Department to explain what happened.

But really, what I'm seeing in the world is a very quick turn to succession. There are internal candidates and there are external candidates for Nvidia's long-term CEO. What do we know there?

Ian King (3:59)

Yeah, I mean, they have to move quickly. I mean, we always say that in this kind of a situation, but they absolutely have to. There's just way too much at stake. This company needs to reassert its direction. And because all of its direction came from the man at the top, they need to replace that person at the top of this company and reassert that direction.

Ed Ludlow (4:19)

Ian, this is really hard, but we have multiple Justice Department probes, including an espionage probe, which looks at Jensen Huang's relationship with Alice Huang. There are all kinds of headlines about what Alice Huang has done. Alice Huang, the person that Jensen conceded that he had an affair with an alleged Chinese spy.