5 Biggest Losers From Nvidia’s $740 Billion CEO Crisis
More on the AI trade: our AI storyline page collects our pieces on AI stocks.
If you have a 401(k), you probably did not buy Nvidia this week. You likely own it anyway: it is one of the largest weights in every broad US index fund.
On Nov 8 Nvidia’s board opened an investigation into reporting that CEO Jensen Huang had been the target of a foreign intelligence effort; Huang admitted an affair with an executive reportedly suspected of spying for China. On Nov 11 the Wall Street Journal reported the board was preparing to oust him. At 8:52 am ET Thursday, Nvidia said Huang had resigned, effective immediately, with CFO Colette Kress as interim CEO. The stock traded at $155.90 premarket Thursday (8:52 am ET), down 10.3% from Wednesday’s close, 16.5% below the Nov 6 close and 35% below its Oct 6 record close of $239.24. That is about $740 billion of market value gone since Nov 6.
That weight reaches people who never bought Nvidia. In a portfolio of a few million dollars, it sits in index, tech and retirement funds at once. Do you know your total? Add it up in a free 15-minute call with a Trefis partner firm.
Who Fell With Nvidia?
| Stock | Nov 12 pre | Since Nov 6 | Tie to Nvidia |
|---|---|---|---|
| CoreWeave | −12.0% | +15.2% | Rents its chips; Nvidia owns a stake |
| Nvidia | −10.3% | −16.5% | The company |
| Super Micro | −7.6% | −2.3% | Servers built on its chips |
| SanDisk | −7.2% | +8.6% | Storage for AI clusters |
| Coherent | −5.9% | +14.5% | Optical links for AI clusters |
Nov 12 premarket move vs Wed close, and Nov 6 close to Nov 12 premarket, 8:52 am ET (Intrinio via Trefis); Nov 6 = last close before the news. Ranked by the premarket move among the AI chip and server stocks we track. Nebius (−16.6%) is left out: it fell on its own quarterly report, released Thursday morning. Since Nov 6: SMH +5.5%, SPY +2.5%.
That is the surprise: since Nov 6, almost nothing else fell. The losers move with Nvidia’s own business, not with AI spending. Super Micro is the purest case: the only AI name besides Nvidia down on Nov 9, Nov 10 and Thursday premarket (−0.6%, −2.8%, −7.6%).
Why Are These Four Tied To Nvidia?
Servers. Super Micro said AI systems were about 71% of revenue in its latest quarter, and it is among the first to ship Nvidia’s newest Vera Rubin racks. Nvidia’s chip supply drives its sales.
Neocloud financing. CoreWeave rents out Nvidia chips, and Nvidia became its second-largest shareholder with a $2 billion investment in January. A weaker Nvidia is a weaker backer.
Memory and optics. SanDisk and Coherent sell flash storage and optical links into AI data centers. Micron fell 5.3% and Lumentum 5.8% premarket.
Are Index-Fund Owners Losers Too?
Not so far. Nvidia is one of a total-market fund’s largest holdings, yet the Vanguard Total Stock Market ETF (VTI) is up 2.7% from Nov 6 to Thursday’s premarket: the rest of the market more than made up Nvidia’s fall. Of the megacaps, only Microsoft (−2.1%) also fell since Nov 6. See Is Your S&P 500 Fund A Bet On 7 CEOs?
What If This Blows Over?
The other possibility: a Nvidia problem, not an AI problem, that fades. On Nov 9, the first day after the news, Nvidia fell 4.3% while CoreWeave rose 5.6%, SanDisk 6.2%, Coherent 16.8% and SMH 5.1%.
Since 2003 Nvidia has had 41 days when it fell 5% or more while the S&P 500 fell less than half a point or rose; Nov 10 was one. Three months later it was higher after 25 of the 40 earlier ones, with a median return of +10.2%. The worst: down 51.5% three months after June 10, 2008. If the handover to an interim CEO goes smoothly, supplier losses are likeliest to revert.
What Should You Ask Next?
- Who gained? Nvidia Down 17%, AMD Up 26%: 5 Winners From Nvidia’s Troubles.
- How low could Nvidia go? Will Nvidia Stock Go To $100?
How Much Of Your Money Rides On One CEO?
Nvidia alone lost about $740 billion since Nov 6. For families with seven figures invested, a check of your Nvidia total takes a free 15-minute call with a Trefis partner firm.
For questions about this article or underlying research, email help@trefis.com.