Nvidia Loses Its Founder; the Market Wipes Out $548bn, Then Wins Back More Than Half

1. A resignation written by the board

Thirty-three years end in a release that does not quote the man who built the company. Nvidia said on Thursday that Jensen Huang has resigned as president, chief executive and director, effective immediately; its filing says the board accepted the resignation on Wednesday 11 November. The documents give no reason and disclose no separation terms. The board thanks Huang for his "immeasurable contributions to the company and the industry".

The replacements say as much as the departure. Colette Kress, finance chief since 2013, becomes interim chief executive and keeps the finance job. Harvey C. Jones, a director since 1993 and a former Synopsys boss, becomes Nvidia's "first-ever Chair of the Board". "The Board has full confidence in Colette and the leadership team," he says. The search will "consider internal and external candidates", and results stay on Tuesday.

Resigned, or pushed? Nvidia says resigned. On Wednesday evening The Wall Street Journal reported that the board was preparing to oust him, and Reuters, citing a source, that directors were meeting to decide whether to oust him; on Thursday an NPR headline described him as ousted by the board. We found no statement from Huang on his departure.

2. What is alleged, and by whom

The crisis began with a customer, not a product. In late October The New York Times reported Jensen Huang's relationship with Alice Huang, a former executive of Megaspeed, a Singapore-based buyer of Nvidia chips, whom US authorities were investigating; on 6 November it reported a US intelligence assessment that she was passing information to Beijing. She is not related to Jensen Huang. On Sunday 8 November he wrote to staff, "I was unfaithful to my wife", naming no one, and the board opened an independent investigation into reports that he "has been the target of a foreign intelligence effort", saying it had "no reason to believe" that national security or Nvidia secrets were compromised.

On Wednesday the Times reported a second relationship, with an Nvidia executive who reports to him. Neither Nvidia nor Huang has confirmed it, and the Associated Press says it could not independently confirm the Times's reports; reached by the paper, Huang said: "I don't think you should be talking to me directly." China denies trying to ensnare him. The investigation has not reported, and Thursday's documents do not mention it.

3. From the bell to the open

The market started its verdict before the board delivered one. Nvidia closed on Wednesday at $173.73 and slid after hours as the reports spread. The release was out before Thursday's opening bell (the Associated Press had it by 9.06am New York time): by about 9.11am (3.11pm Paris) the shares were about 11% lower, near $155. The real fall came at the open: about $151 at 9.30am, down 13.1%, then lower still: ABC News had $150.05 at 9.32am, and Stock Analysis showed a low of $148.80 for the day. Then buyers returned. At 9.59am (3.59pm Paris) the price was $162.73, down 6.33%, according to Zonebourse: a rebound of 7.8% from the opening price in under half an hour. At 10.18am (4.18pm Paris) it was $163.12, down 6.11%, according to Stock Analysis. At 9.59am Zonebourse still had the stock down 11.97% over five days, and 14.29% since 1 January.

4. Le Détroit's calculation

The swings are measured in companies, not points. Nvidia had 24.1 billion shares outstanding in August, according to its latest quarterly filing, so Wednesday's close valued it at about $4.19tn. At the opening price, about $548bn of market value had gone; at the $148.80 low shown by Stock Analysis, about $601bn. By 9.59am the loss had narrowed to about $265bn: some $283bn came back within half an hour of the open, more than half of what had been lost. For scale, the loss at the open equals almost six quarters of Nvidia's revenue at its latest quarterly figure, $96.2bn; the rebound alone, almost three (Chart 1).

5. The night markets had priced an exit

Crypto venues said "soon" before Nvidia said "now". As our analysis "Nvidia's Night Shift" showed this morning, Polymarket's contract on Huang leaving by year-end went from 16% on Wednesday morning (24/7 Wall St) to 88% that night (Reuters), while Hyperliquid's Nvidia contract, deployed by Trade[XYZ], traded while Wall Street slept. On Thursday, before the release, Polymarket gave 40% to an announcement by the end of the day, 63% by Friday and 71% by the end of November. These markets traded on the press reports; nothing shows they knew more, and 40% also meant 60% against.

6. Who runs Nvidia now

The interim choice favours the accounts over the roadmap. Kress has joined Huang on results calls for 13 years and knows the numbers investors will scrutinise on Tuesday; her career has been in finance, not engineering. The name most often cited for the permanent job is Ian Buck, Nvidia's vice president of hyperscale and high-performance computing and a pioneer of CUDA, the software that ties developers to its chips: ahead on Polymarket, at 42% on Kalshi, and "the strongest long-term internal candidate" for Futurum's Shay Boloor. Outside names include Arm's Rene Haas. Mandeep Singh, global head of technology research at Bloomberg Intelligence, said Nvidia was unlikely to be "as aggressive" under new leadership, AFP reported on Thursday morning (Chart 2).

7. Le Détroit's reading

The board is building in one night the counterweights Nvidia never had. A company worth more than $4tn had never had a chair of its board and, in one analyst's words, no succession plan in place. Thursday's set-up splits power three ways: a chair, an interim chief, a search. That is governance arriving late, under pressure.

The market's half-hour rebound is the other lesson. Investors sold the man, then bought back the business: the order books for Nvidia's chips did not resign. What they cannot yet price is the vacuum. Our reading: the real test is not the scandal, which the investigation will judge, but Tuesday, when a finance chief, now also chief executive, presents the numbers without Huang and has to show that Nvidia's strategy did not leave with its founder.