Nvidia’s Asian supply chain prepares for life after Huang

TAIPEI/SEOUL – U.S. chip giant Nvidia’s partners and suppliers across Asia, from memory chip powerhouse South Korea to advanced chipmaking hub Taiwan, are redrawing plans in case Chief Executive Jensen Huang is ousted over reports of two extramarital affairs.

Nvidia’s board is meeting late on Wednesday to decide on Huang’s future, a source familiar with the matter said, in a sharp shift of tactics from Sunday, when the board expressed confidence in Huang and his leadership team.

“We will support whatever capacity Nvidia needs, but the new CEO may not be as aggressive as Jensen,” said an executive at a Taiwan supplier who feared his company’s expansion could slow if a successor was not as quick to tie up manufacturing capacity.

The executive sought anonymity because the subject is a sensitive one.

Huang has never anointed a successor, but analysts and investors see two candidates as particularly likely, at least for the short term: Nvidia’s uber-engineer Ian Buck and Chief Financial Officer Colette Kress.

Any setback for Huang could deprive the AI industry of one of its most vocal champions.

His long-term strategy and direction have turned the chip giant’s swelling cash pile into a war chest to fund companies ranging from AI cloud-computing providers and suppliers to the biggest labs.

“Without him at the helm, we will likely see a slowdown in new, aggressive ecosystem-level investments and lucrative bilateral AI infrastructure deals from NVIDIA side,” said Neil Shah, vice president of research at Counterpoint Research.

The longtime Nvidia leader has built a strong supplier network in Taiwan during frequent visits to strengthen ties with key manufacturing partners such as TSMC, Foxconn and Wistron.

In May, he said Nvidia planned to invest about $150 billion a year in Taiwan.

“He can take technologies his engineers believe are possible and turn them into products the whole company commits resources to, takes risks on, and has to deliver,” said Ming-Chi Kuo, an analyst at TF International Securities.

“That’s why the supply chain gets such strong order visibility and is willing to keep up with aggressive spec upgrades.

“It also forces competitors to follow, which drives technology upgrades and supply chain investment across the entire AI industry.”

Shares in TSMC traded 2% lower, while SK Hynix fell 1.6%. Samsung Electronics rose 0.8%.

TSMC, SK Hynix and Samsung did not immediately respond to requests for comments.

In China, AI companies are seeking to secure overseas access to Nvidia chips, concerned that the scandal could spur Washington to tighten curbs on remote access to advanced processors, it was reported on Thursday.

Companies in South Korea, home to key suppliers of the high-bandwidth memory used in Nvidia’s AI chips, were assessing what a leadership change could mean for their expanding ties with the U.S. firm.

Nvidia and SK Group, parent of memory chipmaker SK Hynix, are pursuing an AI initiative encompassing large-scale data centers and next-generation chips valued at about $500 billion.

In forging and deepening Nvidia’s ties with Korean business leaders, Huang has extended partnerships beyond semiconductors into robotics and AI factories.

He personally sketched a roadmap for collaboration on a whiteboard when Lee Hae-jin, founder of South Korean internet firm Naver, visited the U.S., the latter said.

“We’ve built strong ties with Huang over the years,” said an official at a South Korean chip company with business ties to Nvidia, citing Huang’s accessibility whenever business matters needed to be discussed.

“Our biggest question is whether a potential successor would maintain the same favourable relationship with us.”

Lian Jye Su, chief analyst at Omdia, said Huang’s exit may shift Nvidia’s long-term direction and any slowdown in its execution or loss of clarity over its product roadmap could give rivals more room to catch up.

Still, some investors and analysts expect limited immediate impact from any change of leadership.

“The chips Nvidia will ship over the next year or two are already designed and in production, and its customers’ 2027 spending plans don’t depend on who runs the company,” said Armina Rosenberg, portfolio manager and co-founder of Minotaur Capital, which holds Nvidia shares.