Is Jensen Huang’s job on the line? Yale’s Jeffrey Sonnenfeld estimates it’s “about a 50-50”

The question is whether Huang can survive this. To think through what could come next, this editor spoke Sunday with famed professor Jeffrey Sonnenfeld, senior associate dean for leadership studies at the Yale School of Management and founder of the Chief Executive Leadership Institute, which has hosted Huang at its CEO summits. Sonnenfeld likes Huang, he said, and he called Huang’s career salvageable but put the odds at “about a 50-50.” He also had a lot more food for thought.

First, the damage. Until now, Huang has been “revered and trusted by everybody in technology,” Sonnenfeld noted. But he called this episode “remarkably poor judgment.” Even if Huang was merely naive, he said, “any employee in Nvidia other than him would be fired over this,” and the recklessness alone would mean “an irretrievable loss of confidence.”

We also talked about precedents, except, as it turns out, there really are none for what’s unfolding right now. Executives who survive personal scandals sometimes pick up where they left off at another company, Sonnenfeld observed. Former HP CEO Mark Hurd is one example. Between 2005 and 2010, he drove HP to the top of the tech industry by revenue, then was pressured to resign after he filed inaccurate expense reports that hid a personal relationship with a contractor. Oracle hired him about a month later. Huang has no equivalent because Nvidia is his company

Nvidia’s role at the center of a massive and complex circular financing web is what makes this particular predicament so tricky and, undoubtedly, terrifying for a wide number of constituents. Nvidia isn’t just the biggest provider of chips driving the AI boom but also largely the bank behind the buildout. In addition to stakes in hundreds of smaller startups, Nvidia has invested in OpenAI, Anthropic, xAI, CoreWeave and Nebius. In August, it also signed preliminary agreements with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR aimed at mobilizing more than $500 billion over time, and Huang has said Nvidia could backstop up to a quarter of it. The move was widely interpreted as a way to spread risk. Still, a leadership crisis at the center is how a stumble becomes a collapse.

In the meantime, Huang will keep running the company, Nvidia said Sunday. That’ll be a tall order, even for a CEO who already spends much of his time traveling the world to promote Nvidia. For starters, three House chairmen want a closed-door briefing from Huang on November 18. Nvidia is also reporting its newest earnings on November 17. Sonnenfeld expects that even if Huang keeps the title, he’ll have to hand off some of the day-to-day decision-making.

Only one thing is certain right now. Huang doesn’t own the kind of super-voting stock that would cement his power at Nvidia. Sonnenfeld often argues for dual-class structures that empower founders, and he says Huang’s success without one has been the best counterargument to that case. But if Huang had one, Sonnenfeld continued, removing him would be harder.

Huang may well survive the investigation (Sonnenfeld hopes the board clears him of knowingly aiding anyone). The bigger test comes when Nvidia’s employees, customers and partners, and, indirectly, the millions of Americans with Nvidia in their 401(k) plans, have to decide whether an AI economy built largely on the judgment of Huang still makes sense.