Nvidia loses $300bn in market value as Huang scandal threatens his leadership
Nvidia has shed about $300 billion in market value as a scandal around chief executive Jensen Huang threatens his hold on the chipmaker, sending AI-linked stocks lower across global markets.
The shares fell 7.8% in premarket trading, putting the company on course to drop below a $4 trillion valuation for the first time since July 2025, amid reports the board was deciding whether to oust Huang. The board announced an investigation on Sunday into his relationship with a businesswoman called Alice Huang, who is alleged to be a Chinese spy.
"He's the face of Nvidia and Nvidia has been front and center of the AI build-out," said Jun Bei Liu, lead portfolio manager at Ten Cap. "And if we look at how many new cloud data center businesses have been sponsored in this circular financing world, it's pretty much all by Nvidia. And so it has quite a meaningful ramification for what is to come."
The fallout spread across the sector. Nvidia-backed CoreWeave dropped 6%, IREN and Applied Digital also traded lower, and Nebius fell 10.7% after reporting third-quarter results. Micron Technology fell 3.4%, Sandisk and Western Digital eased 5.1% and 3.2%, and Marvell Technology, Intel, Arm Holdings and Texas Instruments dipped between 1.3% and 2.5%. AMD and Broadcom rose 1.7% and 0.8% on expectations the turmoil could create opportunity for rivals.
Markets in Japan and South Korea closed nearly 0.7% lower, and European tech stocks were down about 1%. Nvidia trades at about 12 times its 12-month forward earnings estimates, its lowest since November 2012, according to data compiled by LSEG. Short sellers have made about $3.8 billion in paper profits as of last close, gains that could swell to about $6.8 billion with the share price at $163, according to data analytics firm ORTEX.
What it means for Pakistan: Nvidia's slide matters for Pakistani investors and technology firms tied to the global AI supply chain, and for the wider risk appetite that shapes foreign investment into Pakistan's nascent digital economy. Any prolonged repricing of AI stocks would also weigh on the global market mood that Pakistani savers and funds track through overseas exposure.
