Jensen Huang affair in D.C.: Resignation calls and moves to tighten Nvidia China exports
Huang was notably opposed to strict export controls on AI chips to China, which ruffled feathers with congressional China hawks.
Shares of Nvidia Corp. (Nasdaq: NVDA) surged over 4% in early trading on Wednesday, marking a boost following a tumultuous period for the company. The semiconductor giant had seen its stock plummet by 15.61% in the past five days and 26.34% for the month, all due to allegations surrounding CEO Jensen Huang's extramarital affair with a Chinese spy. However, Nvidia's fortunes may be turning, thanks to the recent strong performance of CoreWeave, a cloud-computing company.
On Tuesday, CoreWeave reported third-quarter earnings that surpassed Wall Street's revenue expectations, while also providing an upgraded outlook for the year. The company's revenue reached $3.66 billion, surpassing the projected $3.55 billion, according to CNBC. Moreover, CoreWeave raised its 2026 revenue forecast from $13 billion to $13.3 billion. As a result, CoreWeave's shares (Nasdaq: CRWV) climbed over 15% in early trading on Wednesday.
The success of CoreWeave could be beneficial for Nvidia for several reasons. With AI companies like Nvidia and CoreWeave, investors may be less concerned about a potential burst of the AI bubble, thus supporting the performance of both companies. In fact, Nvidia is one of CoreWeave's largest shareholders, having invested $2 billion in the company in January, making it the second-largest shareholder. Therefore, CoreWeave's positive outlook directly contributes to Nvidia's standing in the market.
The recent turnaround for CoreWeave is noteworthy, as the company had faced significant challenges due to fears of AI overspending. In the last month alone, CoreWeave's shares experienced a 40.63% decline. At present, it remains uncertain how events at Nvidia will unfold. Betting markets suggest that Jensen Huang will remain the CEO for the foreseeable future. The company's board of directors is currently conducting an investigation into Huang's alleged affair and any potential impact on the organization.
Meanwhile, Baird has downgraded Nvidia's stock from "Outperform" to "Neutral," while Morgan Stanley has also removed Nvidia from its list of top picks, according to CNBC.
Written by urgent.news from Fast Company's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- Nvidia stock gets its first boost of the Jensen Huang scandal era. What’s driving shares higher today? fastcompany.com
- Jensen Huang affair in D.C.: Resignation calls and moves to tighten Nvidia China exports cnbc.com
- Nvidia stock got a rare Wall Street downgrade over Jensen Huang CEO concerns qz.com
