Neocloud stocks slide after Jensen Huang quits Nvidia

AI infrastructure stocks fell on Thursday, November 12, after Nvidia said co-founder Jensen Huang had resigned as president, chief executive and board member, effective immediately. Chief Financial Officer Colette Kress will serve as interim CEO while the board looks for a permanent successor, according to the company's filing. Nvidia shares dropped sharply at the open, and the companies most dependent on its chips and its funding fell with them. Markets recovered some of those losses as the session went on.sec.gov

Huang's exit ended his 33 years at the head of the company. It came after revelations of two extramarital affairs, including one with a woman accused of spying for China, AFP reported. Nvidia did not give a reason for his departure. The board named former Synopsys ↗ 0.02% chief Harvey Jones as its first chair. "We expect the company's operations, customer commitments and product roadmap to continue without interruption," Jones said.afp.com

Neoclouds take the hardest hit

Neocloud companies rent out computing capacity built on Nvidia GPUs, and they were among the worst performers. CNBC reported steep losses at CoreWeave ↘ 6.17%, Nebius ↘ 16.61% and IREN ↘ 6.48%. Nvidia holds stakes in both CoreWeave and Nebius, and it invested about $2 billion in each of them this year, according to Yahoo Finance. CoreWeave gave back part of a sharp rally from the day before, when it reported strong results.cnbc.com+1

Nebius also had its own problem. It said its 2026 revenue would come in at the low end of its forecast because third-party capacity had been delayed, MarketWatch noted. Applied Digital traded lower as well. Super Micro Computer ↘ 10.65% fell after a report that it could face a Justice Department probe connected to the alleged spy, Reuters reported via HuffPost.huffpost.com+1

Partial recovery

Nvidia shares came well off their lows by midday. Retail investors bought a net $111 million of the stock in the first half-hour of trading, the largest opening bid on record for Nvidia, according to Vanda Research data cited by Reuters. Wall Street's main indexes turned positive as energy shares climbed. Rivals Advanced Micro Devices ↗ 5.38% and Broadcom ↗ 5.70% rose, The Detroit News reported, and the Philadelphia Semiconductor Index PHLX Semiconductor Sector Index ↘ 0.02% recovered from its early losses.detroitnews.com+1

Financing questions linger

Investors are focused on Nvidia's role in funding the AI build-out. "Nvidia has been called the 'Bank of AI.' If they have to take a step back because of what's going on, will that cut off funding to smaller companies that need it?" said Joe Saluzzi of Themis Trading, per Reuters. Matthew Tuttle of Tuttle Capital Management raised a related question: "How much demand comes from customers who can pay on their own?" according to The Detroit News.huffpost.com+1

Nvidia will report third-quarter fiscal 2027 results on Tuesday, November 17, the company said. That will be the first test of its leadership under Kress.sec.gov