AI stocks pare losses as investors assess fallout of Nvidia CEO's exit

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Nov 12 (Reuters) - Global AI-linked stocks were trading lower after bouncing off their sessions lows on Thursday, as investors weighed the fallout of Nvidia CEO Jensen Huang's…

Nov 12 (Reuters) - Global AI-linked stocks were trading lower after bouncing off their sessions lows on Thursday, as investors weighed the fallout of Nvidia CEO Jensen Huang's departure on the sector, which is already pressured by funding and regulatory concerns.

Chief Financial Officer Colette Kress will take over as interim CEO as Nvidia looks for a permanent successor, the company said, after news of Huang's two extramarital affairs plunged the chipmaker into its worst crisis ever.

As the centerpiece of the AI ecosystem, Nvidia finances infrastructure built around its chips - a strategy that has drawn scrutiny over circular funding and now risks hurting the sector as the leadership crisis unfolds.

Nvidia shares were last down 5.4% after dropping as much as 14.3% earlier in the session.

Nvidia-backed neocloud firms CoreWeave dropped 8.1%, but came off its lows. Chip stocks were mixed, with the Philadelphia SE Semiconductor index last down 0.9% after falling as much as 3.7%.

"The recovery looks partly driven by bargain hunting after an aggressive selloff, with some investors seemingly betting that Nvidia's competitive advantages, strong AI demand and established customer relationships will survive a leadership transition," said Daniela Hathorn, senior market analyst at Capital.com.

Buying from retail investors also helped put a floor under the Nvidia stock as they bought a net $111 million worth of stock in the first half-hour of trading, marking the biggest opening bid on record for the stock, according to data firm Vanda Research.

Still, Nvidia's market value was on track to close below $4 trillion for the first time since July 2025, shedding over $1 trillion over the past month as rising interest rates, high debt of tech companies and regulatory concerns dampened sentiment.

The biggest hammering came on Sunday after Nvidia's board announced an investigation into Huang's relationship with a businesswoman called Alice Huang, who is alleged to be a Chinese spy.

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