Nvidia CEO Jensen Huang resigns amid alleged affair with reported spy

Nvidia co-founder and CEO Jensen Huang has resigned, the tech giant announced Thursday. Huang's resignation comes amid reports of his alleged affair with a reported Chinese spy.

Colette Kress, the current executive vice president and chief financial officer, has agreed to take over as interim CEO, the company said in a statement.

"The Board has full confidence in Colette and the leadership team, and we expect the company’s operations, customer commitments and product roadmap to continue without interruption," said Harvey Jones, chair of the Nvidia Board of Directors.

The Nvidia board is launching a search for a permanent CEO, and it will consider both applicants from within and outside the company, the statement said.

Shares of Nvidia tumbled about 5% as of Thursday morning, recovering some of the losses from a plunge of more than 13% at the open of trading.

Huang's resignation came days after the company issued a statement announcing an investigation into Huang in light of reporting he "has been the target of a foreign intelligence effort." He later admitted in an internal message to Nvidia staff that he had been "unfaithful to his wife."

Amid the fallout from the allegations and the internal message, The New York Times reported on Wednesday that Huang also allegedly had an extramarital relationship with an Nvidia executive who allegedly reports to him.

The outlet, citing sources within the company, reported that Huang and his colleague were allegedly captured on video being affectionate at a hotel during an Nvidia conference in March. The Times said it had not seen the video.

ABC News has not been able to verify the reporting or the alleged video.

Following the reporting about Jensen Huang and Alice Huang, who are not related, the Chinese government denied the allegations, calling them "baseless and purely slanderous smears against China."

Neither Alice Huang nor her employer, Megaspeed International, responded to ABC News' request for comment after the Times story broke. Alice Huang is currently living in China, Bloomberg reported on Wednesday.

Nvidia soared to prominence in recent years by selling most of the advanced chips behind the AI boom. The company has defied skeptics with strong revenue quarter after quarter, despite political backlash against data centers and looming concerns about an AI financial bubble.

While the stock has performed well over a long-term period it has struggled to keep rising at a steady clip of late, even before the scandal surrounding Huang. Shares of Nvidia are up a staggering 429% over the past five years, even though the stock has fallen about 17% compared to a year ago.

As of Thursday morning, Nvidia ranked as the third-largest public company in the world as measured by market capitalization. The two larger public companies are Apple and Microsoft.

On Sunday, Nvidia shared with ABC News the internal message Jensen Huang sent to employees, in which he said he was "unfaithful," apologizing for hurting his wife and family.

"My actions hurt her and our children. There is no excuse for what I did. I am deeply sorry," the message said, in part. It did not name Alice Huang nor any other person.

Addressing Nvidia staff, partners and shareholders, Huang went on to say, "My responsibility is to serve you and be worthy of your trust. I have fallen short of that responsibility. I am fully committed to NVIDIA and will work to earn back your confidence."

Four days later, Huang resigned.