Micron shares fall after Nvidia CEO Jensen Huang resigns

Micron Technology ↘ 1.82% shares fell on Thursday, Nov. 12, after Nvidia ↘ 4.43% said Jensen Huang had resigned as chief executive. At one point Micron was down more than 4%, as investors reassessed companies tied to Nvidia's AI supply chain. The memory maker designs high-speed chips that Nvidia uses in its AI processors, so a shock at its largest partner hits Micron's outlook directly.benzinga.com

Nvidia's board said Huang stepped down as president, CEO and board member effective immediately. Chief Financial Officer Colette Kress will serve as interim CEO while the board searches for a permanent successor and considers both internal and external candidates. He left after reports that he had an affair with a woman U.S. authorities suspect of spying for China, and later reports of a second affair, with a senior executive who reported to him.sec.gov+1

Supply chain jitters

Analysts warned that Huang's exit clouds the timing of memory and lithography orders for suppliers such as Micron and ASML ↘ 1.20%, according to StockStory, which cited CNBC. Michael Feldman, a portfolio manager at ClearBridge Investments, said Nvidia's product roadmap "is largely visible for the next several years. The risk is execution. Jensen has been the chief conductor of an extraordinarily complex system".reuters.com+1

Nvidia fell as much as 14% at the open before cutting its losses. Other stocks moved in both directions. Intel ↘ 0.58% and Marvell Technology ↘ 1.40% slipped alongside Micron. Shares of neocloud operators dropped more steeply, with CoreWeave ↘ 6.17% and Nebius ↘ 16.61% both falling. Rivals Broadcom ↗ 5.70% and Advanced Micro Devices ↗ 5.38% rose on hopes they could gain ground. The S&P 500 ↗ 0.06% and Nasdaq Composite erased early losses by late morning.cnbc.com+1

Nvidia tries to reassure

Board chair Harvey Jones said the company expects "operations, customer commitments and product roadmap to continue without interruption." Nvidia also confirmed it will still report fiscal third-quarter results on Nov. 17. Jones, a former CEO of Synopsys ↗ 0.02%, becomes Nvidia's first board chair.cnbc.com+1

For Micron, the selloff comes one day after its shares jumped 9.3% when CoreWeave raised its sales forecast. Even after Thursday's drop, the stock is up 146% this year. Its next earnings report is expected around Dec. 16. Analysts hold a consensus Buy rating.stockstory.org+1

The open question is whether Nvidia's AI ecosystem can keep its pace without Huang. Nvidia "is still selling AI chips at a quick rate regardless of who stands on a stage and talks them up," the Associated Press noted, but how the company navigates a future without its founder remains to be determined.barchart.com