Jensen Huang, the man most investors picture when they think about the AI boom, stepped down as Nvidia's chief executive on Thursday. The board met late on Wednesday after reports about his personal conduct, and chief financial officer Colette Kress is now interim CEO while the company looks for a permanent replacement.
How the market took it
Better than you might expect, at first. Nvidia shares opened lower, clawed some of it back, and were down nearly 5% by mid-afternoon in London, according to Reuters. The more telling moves were around it. CoreWeave, the cloud company Nvidia backs, fell more than 6%, as did South Korea's Naver. Rivals Broadcom and AMD rose, and China's own GPU makers jumped close to 10%.
For context, Nvidia's share price has risen roughly ninefold since ChatGPT launched four years ago, and the company is worth about US$4 trillion.
Why this is about more than one person
Over the past year Nvidia has become something like a lender of last resort for the AI industry. Its latest report listed US$164.5 billion of financial commitments, including an obligation capped at US$105 billion linked to an OpenAI data centre in Ohio and more than US$50 billion of lease and capacity guarantees. In August it teamed up with Apollo, BlackRock, Blackstone and others on financing platforms aimed at more than US$500 billion of outside capital, with Nvidia saying it could backstop up to a quarter of the deals.
That support helps smaller AI companies borrow. Several analysts quoted by Reuters made the same point in different ways: if lenders start to doubt Nvidia's leadership or its appetite for these guarantees, the cost of money for the rest of the AI build-out goes up. One called Nvidia the "Bank of AI". Others argued the opposite, that its chips still have no real substitute and demand will hold whoever is in charge.
What we're watching
Nvidia reports earnings next week. The sales numbers will probably be fine. What we want to hear is whether the guidance set under Huang still stands, who is on the shortlist to replace him, and whether the board says anything about the financing commitments. We'd also watch CoreWeave and other heavily financed AI names, because that is where any change in Nvidia's support would show up first.
Sources
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