Nvidia Sheds $650 Billion in a Week as Huang Exit Hits AI Sector

Nvidia has lost roughly $650 billion in market value this week alone, pushing the chipmaker's market capitalization below $4 trillion. The stock now trades around $160, far from its all-time high of just over $243 set a few weeks ago.

The trigger is the resignation of founder Jensen Huang. He stepped down after revelations about extramarital affairs with a suspected Chinese spy and reports of a second relationship with an Nvidia employee.

How big is the damage?

Since its peak on October 6, Nvidia has lost more than $1.92 trillion in market capitalization. Two-thirds of that loss has come since news of Huang's missteps broke. The company's value has fallen from nearly $5.8 trillion to about $3.8 trillion. That drop exceeds the combined individual market capitalization of Tesla, Meta Platforms and Berkshire Hathaway today.

The stock is down 14 percent since the start of the year. The last losing year was 2022, when shares fell 50 percent.

What does this change for the AI sector?

Pressure on AI stocks has been building for weeks, and the US midterm elections sharpened it, at least briefly. Huang's stumbles add fresh selling pressure — and analysts see contagion.

Kathleen Brooks, research director at XTB, said Huang's departure is a burden for the AI sector: "There is now no one left who champions AI the way Jensen Huang did."

An independent market analyst in London said: "There is a certain domino effect, as the technology sector is under pressure from the impact of the Nvidia slump as well as the pre-existing concerns about the AI trade."

Two stress tests next week

Next week brings two major tests for the AI business:

• Tuesday: Nvidia reports quarterly results. CFO and interim chief Colette Kress (Finance chief running the company in Huang's absence) will face questions about the web of financing deals Huang constructed.
• Thursday: The blockbuster IPO of Anthropic, one of Nvidia's largest chip customers, is expected to price and list.

Both events will show whether investor confidence in the AI trade — already shaken before Huang's exit — can hold under pressure.