Nvidia shares fall 5% as CEO Jensen Huang exits amid affair claims
Nvidia shares fell five per cent in afternoon trading on Thursday after chief executive Jensen Huang stepped down, leaving the AI chipmaker more than 30 per cent below the all-time high it reached just over a month ago.
The exit follows weeks of pressure on the stock, driven by reporting on Huang's personal conduct and by wider questions over whether the AI sector is in a bubble. The company was reported on Wednesday to have had a second affair with an Nvidia executive who reports to him. A separate affair was reported to involve a woman described as a suspected Chinese spy.
Dan Ives, partner and senior managing director at Yorkville Ives & Co., framed the board's decision as a clean break. "The old Jensen, the black leather jacket, the Godfather of AI, the rock star viewed as the face of the AI boom, is over and in the past," he wrote, adding that the board "did what we said it needed to do, which is rip off the band-aid and take Nvidia into its next chapter without him after this dark moment for Jensen and Nvidia."
Nvidia is valued at more than US$4 trillion and has been a major driver of the technology sector, helping lift the tech-heavy Nasdaq Composite for most of this year. The index has slumped seven per cent in the past month.
As the crisis unfolded, shares of rivals including AMD and Broadcom moved sharply higher. CoreWeave, the data centre and cloud company in which Nvidia owns a stake of approximately 13 per cent, slid more than seven per cent.
