Nvidia shares plunged more than 13% on Thursday morning, triggering the chipmaker's steepest intraday collapse since 2012. The immediate selling wiped out roughly $700 billion in market capitalisation within the opening minutes of Wall Street trade.
The rout followed the sudden resignation of Chief Executive Jensen Huang.
Huang stepped down after disclosures revealed he maintained an extramarital affair with an individual accused of espionage for China. Mounting scrutiny deepened after further disclosures showed an additional relationship with a subordinate Nvidia corporate executive. The semiconductor designer sits at the foundational core of global artificial intelligence hardware infrastructure, making the sudden leadership vacuum an immediate shock to global equity benchmarks.
Nvidia shares later trimmed steep opening losses to trade down 7.1% as the company moved to stem the panic, naming Chief Financial Officer Colette Kress to take over as interim chief executive officer.
Equities across Wall Street fractured along the fault lines of semiconductor supply chains. Twenty-five minutes into the trading session, the Dow Jones Industrial Average crept up 0.1% to 52,518.60. But the broader market struggled under the weight of the chip sector. The S&P 500 slid 0.3% to 7,598.94, while the tech-heavy Nasdaq Composite dropped 0.4% to 25,362.29.
Traders scrambled across competing hardware names. Advanced Micro Devices jumped roughly 2% as market participants priced in competitive gains against Nvidia's flagship accelerators. Hyperscale cloud providers showed immediate divergence. Alphabet and Microsoft pushed into positive territory. In contrast, specialized compute partners Oracle and CoreWeave dropped amid the broader turbulence.
| Asset / Metric | Trading Move / Level | Institutional Context |
|---|---|---|
| Nvidia (Open) | Slumped >13.0% | Worst opening slump since 2012; ~$700B value test |
| Nvidia (Post-Open) | Off 7.1% | Stabilized after Colette Kress named interim CEO |
| AMD | Up ~2.0% | Gained on potential market share reallocation |
| S&P 500 | Down 0.3% (7,598.94) | Dragged down by mega-cap semiconductor selling |
| Nasdaq Composite | Down 0.4% (25,362.29) |
Institutional desks moved quickly to evaluate whether Huang's abrupt exit compromises delivery schedules for existing enterprise hardware contracts.
Ryuta Makino, software and semiconductor analyst at Gabelli Funds, stated that existing operational run-rates will hold steady over the intermediate pipeline:
In the near term, I think Nvidia will continue to perform as usual. The fundamentals won't change for calendar year 2027 and potentially calendar year 2028. A lot of these deals and supply chain are already locked up.
Yet Makino cautioned that the executive decapitation threatens terminal value: Nvidia "will likely lose market share" over the longer term, impacting calendar year 2029 and beyond.
Market Context: The boardroom crisis hits at an unusually fragile moment for artificial intelligence capital expenditure. Valuations have come under strain from institutional anxiety surrounding enterprise overcapacity, compounded by political friction following US elections that exposed rising public resistance to power-hungry data center developments.
Adam Sarhan of 50 Park Investments pointed to the unresolved national security dimensions surrounding Huang's personal ties, warning that fundamental visibility has degraded overnight.
"We don't know the extent of the line that was crossed," Sarhan said, adding that it remains unverified whether Huang was complicit in any unlawful transmission of trade secrets or proprietary silicon architectures to Chinese entities. "Why would I invest more in AI until we figure out what's going on?"
All eyes now turn to interim chief Colette Kress, who faces the immediate task of reassuring enterprise cloud clients and national security regulators while the board organizes a formal search for Huang's permanent successor.
| Pressured by specialized AI infrastructure pullbacks |
| Dow Jones Industrial | Up 0.1% (52,518.60) | Cushioned by non-tech industrial components |