Mega-drama as reports of a second affair lead to Jensen Huang’s resignation from Nvidia. It turns out the tech supremo may be Bluebeard and one of his mistresses may have been a Chinese spy and responsible for illegal imports of Nvidia’s chips in to China. I say may because nothing has been confirmed but the effect has been to put Nvidia’s shares into free fall.
This is intriguing because it is not clear that GPU chips will suddenly become abundant because of what has happened and interim CEO, Colette Kress, is well up to speed on the business, having been CFO since 2013. At a price fast approaching $150 Nvidia is valued at $3.8 trillion. Nvidia is not yet as cheap as Sandisk but it is heading in that direction with turnover running at around $400bn annualised and some analysts talking of revenue reaching $1 trillion in a couple of years time.
For most of us Jensen Huang’s abrupt fall from grace is a classic black swan event but it turns out that in intelligence circles his peccadilloes were well known. No doubt his wife knew all about him, and many other people as well since he seemed to be fairly open in his approach, regularly being seen in public with Alice Huang. There is no non-compete clause in his contract so who knows what he might do next.
Nvidia is due to report in five days, which should be interesting. My guess is that a year from now the shares will be much higher and look appealing to buy into weakness.
Strategy – Alwaya Right To Buy Shares In Great Businesses
Ask Warren Buffett. He has become one of the world’s richest men by doing just that and not being phased by temporary bad news.
