Huang fallout far from over: Nvidia stock flat, flowers at the gate, earning looms
Dubai: Nvidia shares are staging a recovery in premarket trade on Friday as investors weighed the fallout from Jensen Huang’s resignation. The stock is trying to gain back the losses from the 4.34 per cent fall it took in the previous session. But the pressure from Washington and Beijing keeps mounting. Congress is moving first. Senate Banking chair Tim Scott asked Huang and Commerce Secretary…
Nvidia shares have been experiencing a recovery in early trading on Friday, following the news of Jensen Huang's resignation. The stock was down 4.34% the previous day. However, concerns over the fallout continue to loom, with both Washington and Beijing showing increasing pressure.
The Senate Banking Committee Chair, Tim Scott, has requested Huang and Commerce Secretary Howard Lutnick to appear before the committee. Additionally, three House committees have asked for Huang's testimony on December 1 and 2, or risk facing subpoenas. Huang has already agreed to testify behind closed doors by November 26.
The resignation's impact has not been limited to the United States. Chinese AI shares also plummeted on Friday due to fears of tighter chip curbs. Speaker Mike Johnson has expressed a growing consensus in Congress on limiting exports to China, to which Beijing has responded by warning that stricter US rules could further endanger global supply chains.
Former CEO Jensen Huang resigned from his positions as chief executive, president, and board member of Nvidia on November 13, after 33 years with the company. The board appointed CFO Colette Kress as his interim successor, with Harvey Jones serving as the new board chair. Kress remains the CFO of the company.
The resignation was prompted by a foreign intelligence investigation into Huang's affair with a woman believed to be a Chinese spy. China has denied any spying allegations. The scandal has cost Nvidia approximately $500 billion in market value, with its valuation falling below $4 trillion for the first time since 2025.
Despite these challenges, analysts believe that Nvidia's success lies in its underlying strengths, such as its CUDA developer base, strong demand from hyperscalers, and the Blackwell roadmap. However, the company's leadership stability remains a concern, as several executives report directly to Huang. Investors are closely watching Nvidia's Q3 earnings report on November 17, as a solid set of numbers may not be enough to offset the damage from the scandal.
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