Nvidia Shares Fall 4.3% to $178.67 as Investigation Fallout Deepens
Key Facts
Nvidia shares fell 4.3% in Monday’s session, Nov. 9, closing down $7.97 at $178.67, as fallout widened from the board’s investigation into allegations targeting Chief Executive Jensen Huang. Reuters estimated that the stock’s losses reduced the company’s market value by about $190 billion during the session. Alongside the internal review, a proposed class action was filed against the company and Huang in federal court in San Jose. The lawsuit accused them of misleading shareholders about the alleged ties under investigation. Reuters said the suit was filed five minutes after the U.S. market closed.
Monday’s decline coincided with a broader retreat in artificial intelligence stocks that began in early October amid growing concerns about a bubble forming in the sector, according to the Associated Press. The agency said Nvidia shares lost 23% in the 30 days ended Nov. 9, after reaching a record high the previous month. In Monday’s session, shares of some companies linked to the sector, including AMD and CoreWeave, rose, while Nvidia shares fell. Reuters noted that the company’s Asian suppliers’ shares closed higher in the same session. TSMC shares rose 4.7%, while Samsung Electronics and SK Hynix gained 0.6% and 0.4%, respectively.
Concerns center on the investigation’s impact on Nvidia’s leadership and governance, as well as the sensitivity of its business to U.S. export controls. Dan Ives, an analyst at Yorkville Ives & Co., said the possibility that Huang could step down or be removed as chief executive was "slim," describing him as "irreplaceable," but warned the investigation could remain a short-term burden on the stock. A Reuters report said Huang owns about 3.6% of the company’s shares and that dozens of executives report directly to him under an unusually flat management structure. The report added that Nvidia has no dual-class shares that would give Huang voting control. According to the Associated Press, Nvidia’s advanced chips have been at the center of U.S. export restrictions aimed at limiting China’s access to advanced semiconductor technology, while analysts said the case could strengthen calls for tighter restrictions.
In a message to company employees, Huang acknowledged that he had not been faithful to his wife and said his actions had hurt her and their children, while also expressing support for the investigation and a commitment to cooperate. The Associated Press quoted Chinese Foreign Ministry spokesman Guo Jiakun as rejecting the accusation and describing it as unfounded and a slander against China. U.S. President Donald Trump said he had not spoken to Huang about the allegations and described him as a good person, adding: "I hope everything is fine." The investigation’s impact extended to South Korea: Madison Huang, the chief executive’s daughter and an executive at Nvidia, canceled a planned visit to Seoul to attend a company conference starting Monday. South Korea’s Ministry of Science said it did not expect disruption to contracted deliveries of Nvidia graphics processing units despite the problems facing the company.
An analyst at NH Investment & Securities warned that a lengthy investigation or internal review could delay Nvidia’s investment decisions, product shipments or launches, potentially affecting the broader semiconductor industry. An analyst at Citi said investors were watching the governance fallout, the possibility of increased regulatory scrutiny and compliance with export controls on H200 chip shipments to China; the analyst estimated those shipments account for less than 1% of data-center sales. The next near-term milestone for investors is the fiscal 2027 third-quarter earnings call, scheduled for Nov. 17 at 5 p.m. Eastern time. The fiscal quarter ended on Oct. 25, 2026. An analyst at eToro said the results would be the stock’s next test and that the investigation could weigh on sentiment unless it leads to a change in leadership.