Nvidia CEO Jensen Huang Resigns Under a Cloud of Scandal, and the AI Selloff Deepens: $2 Trillion Gone in a Month

AI-linked companies fell on Thursday as a deepening scandal around Nvidia CEO Jensen Huang's affairs threatened to upend the chipmaker's leadership, Reuters reported. Nvidia's shares fell 7.8 percent in premarket trading, putting its market value on course to drop below $4 trillion for the first time since July 2025, amid reports the board was deciding whether to oust Huang - and by the time Reuters' Open Interest column filed, Huang had resigned under a cloud of scandal, the stock tumbling as much as 14 percent in early trade to about 40 percent below its October 6 high, more than $2 trillion in market value erased in a little over a month.

The timeline is the one this station opened on Monday (SQ-20261109-001, the board investigation). Nvidia has lost about $300 billion in market value since the board announced an investigation on Sunday into Huang's relationship with a businesswoman called Alice Huang, who is alleged to be a Chinese spy, Reuters reported. After reports of another potential affair with an Nvidia employee emerged, Huang stepped down on Thursday, the column reported. "He's the face of Nvidia and Nvidia has been front and center of the AI build-out," Jun Bei Liu, lead portfolio manager at Ten Cap, told Reuters. "And if we look at how many new cloud data center businesses have been sponsored in this circular financing world, it's pretty much all by Nvidia." "Jensen Huang" was the No. 1 U.S. search on the TrendingSoup X Trends snapshot read this run.

The selloff spread through the whole AI complex. Nvidia-backed neocloud firm CoreWeave dropped 6 percent, IREN and Applied Digital traded lower, and Nebius fell 10.7 percent after reporting third-quarter results, Reuters reported. Micron Technology fell 3.4 percent, Sandisk and Western Digital eased 5.1 and 3.2 percent, Lumentum, Coherent and Dell eased between 3.3 and 4.1 percent, and Marvell Technology, Intel, Arm Holdings and Texas Instruments dipped between 1.3 and 2.5 percent. Rivals AMD and Broadcom rose 1.7 and 0.8 percent on expectations the turmoil could create opportunity. Japan and South Korea closed nearly 0.7 percent lower and European tech stocks were down about 1 percent. The Philadelphia Semiconductor Index had already suffered its second-biggest loss on record on November 5, a 12 percent slide following the midterm elections, and stood down almost 40 percent from its June high. Nvidia short sellers had made about $3.8 billion in paper profits as of the last close, a figure ORTEX data put on course to swell to about $6.8 billion with the share price falling to $163; the stock trades at about 12 times forward earnings, its lowest since November 2012, according to LSEG data compiled by Reuters.

Yet the wider market held. The S&P 500 sat only around 3 percent off its all-time high, Reuters' column noted, and the equal-weighted S&P 500 hit a record high last week and is up nearly 5 percent since October 6, as investors rotated into defensive, value-oriented sectors: between October 6 and Wednesday's close, seven of the index's 11 sectors posted positive returns, with healthcare up 13.1 percent and consumer staples 11.8 percent against technology's 13.7 percent drop, according to Carson Group figures cited by Reuters. JPMorgan's analysts flagged unusually aggressive deleveraging and liquidation across equity and quantitative funds, and Goldman's sentiment indicator fell to its lowest since April 2025. Whether rotation can keep softening the blow, Reuters concluded, is the open question - with the Nvidia controversy, the new Congress and possible Federal Reserve rate hikes still pressing on the AI trade.