Nvidia's shares dropped 7.8 percent in premarket trading amid discussions over Jensen Huang's potential removal, threatening to pull the company's market capitalization below $4 trillion. The turmoil swiftly spread to hardware partners and international indexes, compounding existing sector pressures from data center regulatory fears following Democratic midterm wins. Despite the broad tech decline, competing semiconductor firms AMD and Broadcom advanced as investors weighed potential market share realignments. Nvidia's steep slide also compressed its forward valuation multiple to roughly 12 times earnings, reaching its lowest point since late 2012.
Key points
The leadership vacuum at Nvidia triggered widespread declines across international semico…: The leadership vacuum at Nvidia triggered widespread declines across international semiconductor suppliers, hardware firms, and neocloud operators.
Competitors AMD and Broadcom managed to gain ground as investors positioned for shifts in…: Competitors AMD and Broadcom managed to gain ground as investors positioned for shifts in AI chip market share.
The sharp selloff pushed Nvidia's valuation multiple down to roughly 12 times forward ear…: The sharp selloff pushed Nvidia's valuation multiple down to roughly 12 times forward earnings, a low unseen since November 2012.
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Nov 12 : AI-linked companies fell on Thursday as a deepening scandal around Nvidia CEO Jensen Huang's affairs threaten to upend the chipmaker's leadership, posing fresh risks to the sector already reeling under funding and regulatory concerns.
As the centerpiece of the AI ecosystem, the chipmaker finances infrastructure built around its chips - a strategy that has drawn scrutiny over circular funding and now risks weighing on the sector as its crisis deepens.
AI stocks have struggled after the Democrats swept the midterm elections, including in states opposed to new data centers, stoking fears that tighter regulation could slow the AI infrastructure build-out.
Nvidia's shares fell 7.8 per cent in premarket trading and put its market value on course to drop below $4 trillion for the first time since July 2025 amid reports that the board was deciding whether to oust Huang.
Nvidia-backed neocloud firms CoreWeave dropped 6 per cent after surging more than 27 per cent in the previous session when its earnings ignited a relief rally in AI stocks.
Other neocloud stocks including IREN and Applied Digital were…
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Market participants are retreating from artificial intelligence equities worldwide following worsening developments tied directly to the prominent chipmaker. The intensifying issues surrounding the firm have prompted widespread selling pressure, sparking a broader decline that stretches across international markets. This downward momentum has left related technology companies feeling the direct strain of the unfolding situation.