Yale professor Sonnenfeld says Jensen Huang's fate is roughly a 50-50 proposition, and the NVIDIA board investigation is rippling through the AI industry

Jeffrey Sonnenfeld, Senior Associate Dean for Leadership Studies at the Yale School of Management and founder of the Chief Executive Leadership Institute, said in an interview with TechCrunch that whether Jensen Huang can ultimately keep his position as NVIDIA's CEO is currently about a 50-50 proposition. He believes there is still room to salvage Huang's professional reputation, but that this incident has already caused a fairly serious crisis of trust.

Sonnenfeld has long studied corporate executive leadership and corporate governance, and once invited Huang to attend a CEO summit held at Yale University. He said he has always greatly admired Huang, but that the error of judgment reflected in this incident is hard to understand.

Previously, Huang had enjoyed an extremely high reputation in the tech industry and was widely regarded as a key figure driving the development of the AI industry. However, Sonnenfeld believes that even if Huang was merely lacking vigilance and did not realize he might become a target of a foreign intelligence operation, such behavior may itself constitute serious managerial negligence. He pointed out that if any ordinary NVIDIA employee were in a similar situation, they could face dismissal, and the company's top leader should not enjoy a completely different security standard.

One favorable factor Huang may have is the personal credibility he built for NVIDIA over the past 30-plus years. Sonnenfeld cited the social psychology concept of "Idiosyncrasy Credits" to explain that people who have demonstrated outstanding ability over a long period, complied with organizational norms, and created value for the collective can usually accumulate a certain amount of trust credit within the organization. When they occasionally make mistakes, the organization may give them more opportunities to explain and correct course.

Since co-founding NVIDIA in 1993, Huang has led the company from a graphics chip maker to becoming a core supplier of global AI infrastructure. This experience has undoubtedly earned him enormous prestige and trust.

But Sonnenfeld also warned that this trust is not unlimited. When a manager's behavior is seen as involving personal interests, or as touching on the organization's most core security and ethical norms, previously accumulated credibility can also be rapidly depleted.

NVIDIA currently has about 42,000 employees, a large number of whom must comply with strict information security rules. At the same time, the company's business also involves U.S. government controls on exports of advanced semiconductors. Huang's personal conduct is therefore no longer merely a private-life matter; it may also affect employees' trust in management, as well as the U.S. government's and business partners' assessment of NVIDIA's security management capabilities.

This incident is also clearly different from an ordinary corporate executive's extramarital affair scandal. Huang admitted that he was unfaithful to his wife, while his partner, Alice Huang, is suspected by U.S. intelligence agencies of having been recruited by China's Ministry of State Security and of trying to obtain information about NVIDIA and U.S. advanced AI chips through a personal relationship.

Huang has publicly apologized to his wife, children, and NVIDIA employees, acknowledging that his behavior hurt his family and also failed the trust of company colleagues, the board of directors, partners, and shareholders. He said he will fully cooperate with the board's investigation.

However, Sonnenfeld believes that if it can ultimately be proven that Huang was indeed deceived without his knowledge, then he still has a chance to turn things around. The key is whether the investigation can confirm whether he knew that Alice Huang might be engaged in intelligence activities, and whether sensitive NVIDIA information was involved during their contacts.

Historically, there have also been cases of corporate executives who left their positions because of personal scandals and later regained career opportunities. For example, former HP CEO Mark Hurd led the company between 2005 and 2010 to become one of the world's largest tech companies by revenue, but was ultimately forced to resign because he submitted inaccurate expense reimbursement records in an attempt to conceal a personal relationship with a contractor. About a month later, Oracle hired him as co-president.

However, Huang's situation is completely different from Mark Hurd's. NVIDIA is in fact the company Huang built with his own hands, and he has no position at another company of comparable scale to which he could easily move. If he leaves NVIDIA, he will lose the most central leadership platform of his career.

NVIDIA also lacks an obvious internal successor. Huang previously disclosed that the company has about 60 managers who report directly to him. He has long preferred to maintain a flat management structure, which, while helping improve decision-making efficiency, also leaves the company facing difficulties in succession arrangements if the top leader suddenly departs.

Sonnenfeld believes that if the board ultimately decides to replace the CEO, it may consider looking outside the company for a candidate with sufficient prestige and management experience. He even mentioned former Google CEO Eric Schmidt, saying that veteran figures with experience managing large tech companies could become transitional choices during a crisis.

But the question of whether Huang stays or goes concerns not only NVIDIA itself, but may also affect the entire AI industry.

NVIDIA is now not only the world's largest supplier of AI chips, but also an important provider of capital in the AI infrastructure investment chain. The company has already invested in OpenAI, Anthropic, xAI, CoreWeave, and Nebius, among others, and also holds equity stakes in hundreds of startups.

In August of this year, NVIDIA also signed preliminary agreements with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR, planning to mobilize more than $500 billion in funding over the coming period to drive artificial intelligence infrastructure construction. Jensen Huang previously said that NVIDIA might provide support for up to a quarter of that funding.

This means that Jensen Huang is not only NVIDIA's manager, but also an important driver of the entire AI industry's capital cycle and infrastructure expansion. If he were to leave suddenly, the impact could quickly spread to chip suppliers, cloud computing companies, AI model developers, and financial investment institutions.

In addition, the NVIDIA board of directors must also investigate the company's business relationship with the Singapore data center company Megaspeed. Megaspeed was once an important NVIDIA customer in Southeast Asia, and its business involved large-scale procurement and use of NVIDIA AI chips. U.S. authorities had previously been looking into whether the company helped Chinese customers circumvent U.S. export restrictions through methods such as chip resale or remote leasing.

Sonnenfeld pointed out that Jensen Huang had previously been actively advocating allowing NVIDIA to sell advanced AI chips to China, which in itself had already made some U.S. policymakers uneasy. Now, the board's independent directors need to further ascertain exactly which NVIDIA technologies entered the Chinese market, through what channels they flowed, and what role Megaspeed played in the entire supply chain.

Jensen Huang will continue to serve as CEO in the short term. NVIDIA has clearly stated that the board currently has no reason to believe that U.S. national security or the company's trade secrets have been compromised, and it maintains confidence in Jensen Huang and his management team.

However, Sonnenfeld expects that even if Jensen Huang ultimately keeps his position, he may need to hand over some day-to-day decision-making authority to other executives in order to reduce the company's dependence on a single leader.

Another important factor is that Jensen Huang does not hold super-voting shares that would grant a founder special control rights. This means that, unlike some tech companies that use dual-class share structures, NVIDIA's board of directors has greater room at the corporate governance level to decide on the CEO's retention or departure when necessary.

There are two key upcoming time points worth watching. First, the chairs of three U.S. House committees have asked Jensen Huang to attend a closed-door briefing on November 18 to explain his relationship with Alice Huang and NVIDIA's information security system. Second, NVIDIA plans to release its latest quarterly earnings report on November 17, when investors will also closely watch whether management will further respond to this incident.

Sonnenfeld finally pointed out that this controversy may become an important turning point for the tech industry to strengthen trade secret protection. He believes that, compared with defense contractors, large tech companies have long been insufficiently strict in guarding against personnel contacts, internal information protection, and potential intelligence infiltration.

At present, Jensen Huang still has a chance to weather this crisis, but what will truly determine his career fate will be the board investigation results, the U.S. government's follow-up review, and whether NVIDIA employees, customers, and investors continue to believe in his leadership ability.

For NVIDIA, this is no longer just a personal reputation crisis for its CEO, but a major test involving corporate governance, national security, supply chain compliance, and the stability of the entire AI industry. Sonnenfeld's fifty-fifty assessment precisely reflects the high degree of uncertainty in Jensen Huang's current situation.

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