The shock resignation of Nvidia CEO Jensen Huang on Thursday renewed pressure on the chipmaker’s shares, with the company on track to lose more than $700 billion since the close of U.S. trading last week.
Nvidia announced Huang’s resignation on Thursday morning. In a statement, the company said Chief Financial Officer Colette Kress will take over as interim CEO.
Nvidia shares plunged $16.54, or 9.5%, to $157.19 in early trading. The latest drop comes after the stock shed 9.6% of its value in trading on Monday and Tuesday following the disclosure last weekend that Huang had an extramarital affair with a woman U.S. intelligence agencies believe was a Chinese asset.
Nvidia, co-founded by Huang in 1993, became a key player in artificial intelligence due to its powerful semiconductors that fuel many of the world’s leading AI firms. Because of Nvidia’s importance to the growing industry, its chips are subject to export controls that limit their sales to China. Huang had pushed the Trump administration to relax some of those regulations.
Huang, one of the world’s best-known CEOs, has served as the face of the AI industry, promoting its benefits and arguing that new regulations weren’t necessary to ensure its safety. Before this week’s revelations about his relationship with Chinese business executive Alice Huang (no relation), he had been seen as essential to Nvidia’s success, with Wall Street analysts warning that the stock could plunge if he were ousted or resigned.
Separately, The New York Times reported Thursday that Jensen Huang also had an affair with Kimberly Powell, Nvidia’s vice president of healthcare, citing other company employees.
“What seemed impossible a week ago is now a reality as we cannot see Jensen running Nvidia as CEO at this point, and the stock/company should be valued without him as CEO,” said Yorkville Ives analyst Dan Ives in a research note.
He added, “We also believe the old Jensen with the black leather jacket, Godfather, AI visionary viewed as a rock star globally is over and in the past.”
In a separate report, Ives estimated Nvidia’s value at $225 per share if Huang left the company, compared with $300 per share if he remained at the helm.
“There is no credible way to put a precise revenue loss on his departure,” said Ipek Ozkardeskaya, senior analyst at Swissquote.
“Customers buy Nvidia’s computing power, software and networking ecosystem, and those advantages wouldn’t disappear with its CEO,” she said.
Nvidia’s woes also come at a sensitive time for the AI industry, which has already faced investor concerns about a potential slowdown. Among the questions facing the sector is whether it will prove profitable enough to justify massive investments in the technology.
Anthropic’s initial public offering will provide another key test, with the Claude AI bot developer expected to make its market debut as early as next week.
