The downfall of AI’s $5.7 trillion man
Nvidia is the default supplier of the vital chips that are fueling the AI industry’s rapid growth, and with a market cap that, at one point, topped $5.7 trillion, had seeded an entire ecosystem that came to depend on Nvidia’s support.
- The then– Nvidia CEO had a gospel to share with the politicians, tech executives, and journalists, Fortune among them, crowding the room: The AI boom was only getting started, and Nvidia was in town to help bankroll it.
- If the AI boom is a kind of religion, then Huang had been its high priest—proselytizing to investors and policymakers, ministering to the faithful, and doling out alms to needy startups, AI labs, and neoclouds.
- Worries about rising interest rates, dire warnings about AI’s extinction-level risks, and Americans’ opposition to data centers—on display in November’s midterm elections—have already put the AI boom’s foundations on shaky ground.
The man who sold the world his vision of an AI future was soon fighting for his own future—and on Thursday morning, the seismic news broke: Jensen Huang had resigned from his role as CEO.
But even the company’s harshest critics didn’t expect the biggest threat to Nvidia to come from the man at the center of it all.
- The company said that as of the end of July it had invested nearly $50 billion into leading AI model companies alone, including stakes in OpenAI, Anthropic, and Elon Musk’s xAI, and its equity investments across the AI ecosystem totaled twice that amount.
- intelligence agencies believed Huang had been involved with a woman who was working as a Chinese intelligence asset: Alice Huang (no relation), a former executive at Megaspeed, a Singapore-based data center company that had bought billions of dollars’ worth of Nvidia chips.
- Within a week, Huang had sent a memo to Nvidia’s 42,000 staffers acknowledging he had been “unfaithful” to his wife and was “deeply sorry.” Nvidia’s board launched an independent investigation; U.S.
- Critics have long warned that Nvidia’s AI investments had created a risky “circular” web in which Nvidia pours money into AI labs and data center companies, which in turn buy Nvidia chips.
- “We’re not your largest investor, but we are your best investor.” Huang’s London visit was one stop on a European charm offensive that also swept through France, Sweden, and Germany.
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