"Without Japan and Sega, there would be no NVIDIA today," Jensen Huang, then CEO of NVIDIA, said during his visit to Tokyo in July, recalling the early investment from the Japanese gaming company Sega. He referred to Japan as a "valuable friend." Just four months later, Huang stepped down amid allegations of infidelity and accusations of being a Chinese spy. Japanese media are now focusing on the future of the AI collaboration Huang built with Japan.
NVIDIA announced on November 12 that Huang had resigned immediately. The Nihon Keizai Shimbun reported that an emergency board meeting on November 11 effectively decided his dismissal. Huang, who co-founded NVIDIA in 1993 and led the company for 33 years, will be temporarily succeeded by Colette Kress, the Chief Financial Officer. The board has begun searching for a permanent replacement.
Huang's July visit highlighted how he cultivated relationships in Japan. According to the Yomiuri Shimbun, he partnered with companies like Fujitsu and Toyota in areas such as 'Physical AI,' which enables machines to operate autonomously. During his trip, he mingled with leaders of Japanese semiconductor firms at an izakaya in Kanda, Tokyo. His appearance as the head of the world's largest AI semiconductor company in a local bar generated significant buzz in Japan. An executive from a Japanese company that interacted with Huang described him to the Yomiuri as "charismatic, visionary, and passionate."
Huang not only engaged with businesses but also directly approached various governments. According to the Nikkei, he advised the Japanese government during his visit to develop its own AI capabilities, stating, "A nation's intelligence must be cultivated domestically." This aligned with Japan's interest in developing its AI sector and NVIDIA's search for promising markets. He also reached out to European governments concerned about falling behind the U.S. and China. However, the Nikkei noted that Huang's 'top sales' approach heavily relied on his personal connections, raising doubts about whether his successor could fulfill the same role.
The uncertainty extends beyond government relations. The Yomiuri identified NVIDIA's investment strategy as another variable. The company has funded AI developers and data center firms to cultivate customers for its semiconductors. One source told the Yomiuri that if this strategy changes under new leadership, it could have widespread repercussions across the AI industry.
Among the potential successors is Rene Haas, CEO of Arm, a British semiconductor design firm under SoftBank Group, who has ties to Japan. The Nikkei noted that he worked at NVIDIA for seven years before joining Arm and currently serves as a director at SoftBank Group.
While searching for a permanent successor, NVIDIA also announced the creation of a board chair position to oversee the CEO for the first time. The Nikkei pointed out that as companies grow, executives must be able to challenge the founder's decisions, and the board should have the authority to intervene. NVIDIA had not established a governance structure to check the concentrated power Huang held while investors and customers celebrated his achievements. The Nikkei suggested that Huang's resignation serves as a wake-up call for many companies that rely heavily on strong founders without preparing for succession.
Tokyo's stock market reacted positively. On November 13, the Nikkei average rose by 997.36 points (1.64%) to close at 61,816.72, briefly surpassing a 1,000-point increase. Advantest, which had fallen 4.6% the previous day, surged by as much as 7%, contributing approximately 370 points to the index. Ibiden, a supplier of semiconductor packaging substrates to NVIDIA, also saw its shares rise by over 6% at one point.
The Nikkei analyzed that the previous day's decline in related stocks reflected the potential for Huang's resignation, while NVIDIA's stock in the U.S. market had reduced its losses by the close, prompting a buying spree. Yugo Tsuboi, chief strategist at Daiwa Securities, told the Nikkei that the appointment of a CFO with extensive experience at NVIDIA brought a sense of relief. Meanwhile, NVIDIA is set to announce its earnings on November 17 (Korean time, November 18 morning).
* This article has been translated by AI.
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