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AI Shares Tumble on Nvidia CEO Exit Fears
13 Nov
Summary
- AI-related US stocks plummeted, led by CoreWeave and Nebius Group.
- Concerns over AI financing grew following Nvidia CEO Jensen Huang's departure.
- Nscale reported a widened net loss of $1.7 billion for nine months.
US AI-related companies saw their stock prices fall significantly on Friday, with neocloud firms experiencing substantial losses. This downturn was largely attributed to renewed concerns about AI financing, particularly in the wake of Nvidia CEO Jensen Huang's unexpected departure. The Nasdaq-100 index and the Philadelphia SE Semiconductor index both registered notable declines.
CoreWeave and Nebius Group, both companies supported by Nvidia, experienced steep drops in their stock values. The market expressed unease over Nvidia's past financing strategies, which involved funding infrastructure built around its chips. Industry experts suggest this marks a significant disruption to the sector's financing landscape.
Further contributing to the negative sentiment, British cloud provider Nscale amended its IPO filing to disclose an increased net loss of $1.7 billion for the nine months ending September 30. This wider loss compared to the previous year heightened investor caution.
Broader semiconductor and AI-related stocks also suffered. Advanced Micro Devices, Broadcom, Micron Technology, and data storage companies all saw their share prices decrease. Other exposed sectors, including photonic product makers and AI server manufacturers, also faced selling pressure.
Major AI hyperscalers were mostly lower, with the exception of Meta Platforms, which saw a slight gain. Oracle, Alphabet, Amazon, and Microsoft experienced declines. Attention now turns to Nvidia's upcoming quarterly earnings and the anticipated public market debut of AI lab Anthropic next week, which could influence future market sentiment.
