Nvidia's stock dropped more than 8% in after-hours trading on Wednesday after reports emerged that the chipmaker's board was deliberating whether to remove its long-time chief executive, Jensen Huang. The shares had closed up 2.9% at $173.73 in regular US trading, but the news reversed those gains and cast a shadow over the AI sector.
According to Reuters, citing a person familiar with the matter, the board convened late Wednesday US time to decide Huang's fate. The Wall Street Journal first reported that the board was preparing to oust him, though no final decision has been announced.
Leadership uncertainty rattles markets
Huang, who co-founded Nvidia in 1993, has become the public face of the company and, by extension, the AI boom. Nvidia's chips are the backbone of most AI training systems, making the company a bellwether for the entire technology sector. A change at the top could have far-reaching consequences for AI development and investment worldwide.
The leadership crisis follows a series of revelations. On Sunday, Nvidia's board announced an independent investigation after reports that Huang had been targeted by a foreign intelligence operation. The board stated it had no reason to believe company secrets or US national security had been compromised and expressed confidence in Huang.
Huang has acknowledged an extramarital affair, and Reuters reported that the woman involved was suspected of spying for China. The New York Times added on Wednesday, citing five former Nvidia employees, that Huang was also involved in a second affair with Kimberly Powell, the company's vice president of health care.
The turmoil has already had a global impact. Asian shares mostly fell on Thursday, with Taiwan's Taiex dropping 2.6%, Hong Kong's Hang Seng losing 1.2%, and Japan's Nikkei 225 slipping 0.7%. The Shanghai Composite fell 0.6%, South Korea's Kospi slipped 0.2%, and Australia's S&P/ASX 200 edged down nearly 0.1%.
European markets, however, showed resilience. DAX and FTSE 100 futures both rose 0.7% ahead of Thursday's open, even as US futures were weighed down by Nvidia's after-hours slide. The divergence highlights Europe's growing independence from US tech swings, though the continent's tech sector remains sensitive to AI sentiment.
On Wall Street, the Nasdaq Composite gained 1.6% on Wednesday, the S&P 500 rose 1.3%, and the Dow Jones Industrial Average added 0.5%. CoreWeave, a cloud platform that rents AI chips, jumped 24.7% after reporting a smaller quarterly loss than expected. The US bond market was closed for Veterans Day.
The rally was part of a broader rebound in AI stocks after last week's sell-off, which was triggered by concerns over tighter regulation following the Democratic sweep of Congress. Investors are also weighing whether AI demand will generate enough profit to justify the industry's heavy spending.
Oil prices were slightly higher, with benchmark US crude up 0.3% at $86.80 a barrel and Brent crude up 0.5% at $93.21 a barrel. Brent has traded between $72 and $120 a barrel since the Iran war pushed prices higher. In currency markets, the dollar edged down to ¥159.78 from ¥159.79, while the euro slipped to $1.1080 from $1.1091.
For European investors, the Nvidia saga is a reminder of how intertwined global tech fortunes have become. The company's chips power AI systems used across the continent, from research labs in Berlin to financial hubs in London. A leadership change could slow innovation and affect supply chains, making the outcome of the board's deliberations a matter of interest well beyond Silicon Valley.
As the situation develops, European markets will be watching closely. The board's decision, expected soon, could either restore confidence or deepen uncertainty in a sector that has become central to the global economy.
