AI Dealmaking and Financing Could Come Under Pressure If Jensen Huang Leaves Nvidia, Morningstar Warns

AI dealmaking and financing could suffer if Jensen Huang departs as Nvidia CEO, according to Morningstar, with repercussions potentially spreading throughout the artificial intelligence industry. Given the central roles of Nvidia and Huang within the AI ecosystem, his departure could leave the sector facing reduced deal activity and financing, stricter regulation and greater political opposition to artificial intelligence.

Nvidia connects funding, technology and supply chain networks across the global AI sector, creating an industry-wide exposure to any crisis at the company. Alongside supplying chips to AI companies around the world, it holds investments throughout the industry’s value chain, including OpenAI, Anthropic, xAI, CoreWeave and Nebius. Under preliminary agreements reached in August this year with institutions including BlackRock, Blackstone, Brookfield and Goldman Sachs, the plans envisage mobilising more than $500 billion in funding over time. Nvidia could support up to a quarter of that sum, Huang previously said. A serious crisis in Nvidia’s leadership could consequently spread beyond its own operations to the numerous businesses dependent on its chips, investments and financing support.

Morningstar left Nvidia’s fair value estimate at $310 per share and retained its four-star rating, notwithstanding the questions over Huang’s future. Those assessments indicate that it views the shares as undervalued at current levels. With demand for AI computing capacity continuing to outstrip supply, Morningstar said it did not expect the investigation to affect Nvidia’s revenue in the near or medium term.

An internal letter to all employees on 8 November contained Huang’s admission that he had been unfaithful to his wife, together with an apology to his family, employees, the board, partners and shareholders. Reports alleged that the woman involved in the affair was an asset of a foreign intelligence agency. Also on 8 November, Nvidia’s board said it had set up a special committee of independent directors to establish whether Huang had been targeted by a foreign intelligence operation, with assistance from independent external legal counsel. All available information would be considered, the board said, although it currently had no reason to believe that either national security interests or Nvidia’s core business secrets had been compromised.

The company’s progress would not be slowed by these developments, according to Nvidia’s head of public policy communications. All existing business plans will proceed without interruption under Huang, who will remain CEO. Pending the independent investigation’s final conclusions, he will retain and fulfil the full responsibilities of that role.

Market Insight: Huang’s Track Record Could Prove Decisive

Few other executives possess comparable advantages to Huang. Having co-founded Nvidia in 1993, he has guided its development into one of the world’s most important AI chip suppliers. Both his achievements over that period and the reputation they have earned him could be instrumental in enabling him to withstand the crisis. That established trust could nevertheless fade swiftly should the investigation find that he knowingly disregarded the risks, or that his behaviour crossed fundamental boundaries in company security and corporate governance.