Nvidia Sinks 13% as Huang Exits, AMD and Broadcom Take the Crown

For three years, Wall Street bought the artificial intelligence boom through one ticker. This week, it went shopping for substitutes. Nvidia Corp. (NASDAQ:NVDA) founder Jensen Huang resigned as CEO and board member on Thursday after the board opened a probe into reports that he had been targeted by a foreign intelligence effort, the company announced. Chief financial officer Colette Kress is now interim CEO. Nvidia traded near $162.85 as of 12:11 UTC today, down about 13% from last Friday's close of $186.64, while Advanced Micro Devices Inc. (NASDAQ:AMD) and Broadcom Inc. (NASDAQ:AVGO) were the two best performers in the S&P 100.

Context: Why Nvidia's Leadership Vacuum Reshuffled the Chip Trade

The money did not leave the chip trade. It changed address. That is the single cleanest way to describe what happened across five sessions in which the S&P 100's top two performers and the S&P 500's bottom three came from the same industry.

The comparable the market itself supplied is the losing streak. Nvidia is on track for a sixth straight weekly loss, a run it had suffered only four times before, in 2002, 2008 and twice in 2012. Those prior stretches coincided with broad semiconductor drawdowns. This one did not.

The catalyst chain runs from the boardroom outward. Huang's resignation followed a board probe into reports that he had been targeted by a foreign intelligence effort. That removed the executive most associated with Nvidia's AI franchise and installed a finance chief, Kress, as interim leader with no disclosed timeline for a permanent appointment.

The macro backdrop made the rotation harsher. Consumer prices rose 0.4% in October against a 0.3% forecast, and core prices climbed 0.3% against 0.2% expected. Fed Governor Christopher Waller said a 50-basis-point hike in the policy rate should be considered at the December meeting. The 10-year Treasury yield rose to 5.15% on Friday, its highest since mid-October, up about 29 basis points on the week. Higher discount rates compress the multiples investors pay for long-duration growth stories, and Nvidia's story just lost its narrator.

Data: What the Numbers Show

The scale of the rotation is visible in the ratio tables. Broadcom's price ratio against Nvidia jumped 35.4% this week, the biggest weekly gain in data going back to Broadcom's 2009 listing. The prior record, nearly 33%, came in the week ended Dec. 13, 2024, after Broadcom's earnings.

AMD ran from $404.40 on Nov. 5 to $585.30 on Thursday, a gain of nearly 45% in five sessions. Over the same stretch, the Nvidia-to-AMD price ratio fell almost 37%, its steepest five-day drop since August 2002. Friday brought a reality check: AMD slid about 9%, erasing roughly a third of the rally, and last changed hands at $534.06 as of 12:11 UTC today.

Broadcom rose from last Friday's $293.69 to about $345, its best week since early April, and traded at $347.01 as of 12:11 UTC today. Arista Networks Inc. (NYSE:ANET) rounded out the podium, up about 15% for the week.

Metric	Nvidia	AMD	Broadcom
Week change	about -13%	about +18%	nearly +18%
Friday move	-6.26%	-3.41%	+0.52%
Latest price	$162.85	$534.06	$347.01

The broader market held up. By Friday afternoon the S&P 500 was up about 2.4% for the week near 7,550, and the Nasdaq 100 was up about 3.5% near 27,930, despite falling 1.3% on Friday. The VanEck Semiconductor ETF (NASDAQ:SMH), which holds Nvidia, AMD and Broadcom among its largest positions, was up about 2% for the week, a headline number that hid a violent reshuffle inside the fund.

HSBC downgraded Nvidia to Hold and slashed its price target to $170 from $365. Frank Lee, global head of tech hardware and semiconductor research at HSBC, said in a note Friday that the bank believes the uncertainties will prevail until a permanent succession plan is laid out and the new CEO is able to demonstrate execution capabilities. HSBC said its earnings outlook for fiscal 2028 is intact, but the stock now trades at 11 times forward earnings, its lowest multiple in 15 years.

Rothschild & Co downgraded Broadcom to Neutral from Buy and lowered its price target to $398 from $595, and the stock gave back about 5% on Friday.

Analysis: What the Rotation Means for Chip Investors

The second-order effect is a re-pricing of single-name concentration risk. For three years, passive and active managers bought AI exposure through Nvidia because the ticker was the liquid, benchmark-heavy proxy. When governance risk appears in the proxy, flow migrates to the next-largest liquid names with the same revenue thesis: AMD in accelerators, Broadcom in custom silicon, Arista in AI networking.

That explains why the SMH, which holds all three, barely moved even as its largest position fell double digits. The fund absorbed the reshuffle internally.

The counter-argument deserves weight. AMD's Friday slide of about 9% was its worst session since Nov. 5, and Broadcom's Rothschild downgrade landed the same day. Both suggest the rotation is partly sentiment, not confirmed order books. AMD is up 142% this year while Nvidia is down about 15%, a spread that prices in a business transfer the market has not yet seen in reported revenue.

A second limitation sits in the legal column. Nvidia's board probe concerns reports that Huang had been targeted by a foreign intelligence effort; the company has not disclosed the terms of his separation, and the interim appointment of Kress carries no announced end date.

Positioning tells the story of the week. Traders were long Nvidia and short the substitutes entering Monday. By Friday, that trade was unwound, and the flow ran into AMD, Broadcom and Arista.

Outlook: What to Watch Next

Next week the question shifts from who sold Nvidia to what Nvidia says. The chipmaker reports fiscal third-quarter results Tuesday, Nov. 17, followed by its first earnings call without Huang at the helm. Options traders are pricing an implied move of 9.1% in Nvidia stock after the report, according to Benzinga Pro data.

On the macro side, the Fed's December meeting is the next scheduled decision, and Waller's call for a 50-basis-point hike puts the December outcome in play. Bank of America now expects three straight rate hikes, in December, January and March, taking the federal funds rate to a range of 4.5% to 4.75%. The 10-year yield at 5.15% is the level to watch; a sustained break above it pressures every long-duration chip multiple.

For AMD and Broadcom, this week was a coronation. Tuesday will show whether it was also a transfer of business, or only of sentiment.

Frequently Asked Questions

What does Jensen Huang's resignation mean for Nvidia shareholders?

It removes the executive most identified with Nvidia's AI franchise and leaves an interim CEO, chief financial officer Colette Kress, with no disclosed timeline for a permanent successor. HSBC cut its target to $170 from $365 and said the uncertainties will prevail until a permanent succession plan is laid out and the new CEO demonstrates execution. Nvidia also trades at 11 times forward earnings, its lowest multiple in 15 years.

Why did AMD and Broadcom rally when Nvidia fell?

Investors bet that Nvidia's leadership vacuum would push customers toward its closest rival, AMD, which ran nearly 45% in five sessions from $404.40 on Nov. 5 to $585.30 on Thursday. Broadcom, the custom-chip maker, jumped 8.8% on Monday and another 5.5% on Thursday, the day Huang left. Broadcom's ratio against Nvidia posted its biggest weekly gain since its 2009 listing.