# Nvidia's stock plunge cuts valuation by two trillion

> Jensen Huang's resignation triggered a 34% fall that makes Nvidia look cheap by the numbers, but analysts warn the discount reflects real risks to the company's future.
- Title: Nvidia's stock plunge cuts valuation by two trillion · Fortune
- Summary: Jensen Huang's resignation triggered a 34% fall that makes Nvidia look cheap by the numbers, but analysts warn the discount reflects real risks to the…
- Keywords: nvidia, jensen huang, stock price, market valuation, gpu, competitive advantage, commoditization, Fortune
- Source: Fortune — https://fortune.com/2026/11/12/jensen-huang-downfall-is-nvidia-a-buy-or-sell
- Author: Shawn Tully
- Read time: 2 min
- Topics: nvidia, jensen huang, stock price, market valuation, gpu, competitive advantage, commoditization
## Huang's resignation triggers historic collapse
Nvidia's stock fell 34% to $161 on November 12 after CEO Jensen Huang resigned following revelations about a romantic relationship with an alleged Chinese spy.The fall erased nearly two trillion dollars from the company's valuation.
## Price-to-earnings ratio drops to twenty
Nvidia's P/E fell from 30 in early October to 20 after the stock collapse. By conventional metrics, this makes the company look like a bargain compared to Apple at 40 and Amazon at 22, despite…
## Growth metrics remain strong
In the quarter ended October 31, Nvidia's sales jumped 26% over the previous quarter, beating the around 20% growth of the two previous quarters. Gross margins hit 75%, above its FY 2026 posting of 71.3%.
## Huang's departure threatens competitive edge
An Nvidia customer and top industry executive says Huang was both the tech visionary and an excellent operator.

> Huang was the tech visionary and he also got Nvidia to operate incredibly well. The question is how much depended on Jensen, and how much of what he did can another person do?
## Rivals racing to build competing chips
Competitors including AMD, Google, and Amazon are racing to create their own in-house GPU alternatives to reduce dependence on Nvidia's expensive chips.
## Huang invested heavily in customer financing
In the past four quarters, Nvidia generated 105 billion dollars in free cash flow. Share buybacks fell to 32 billion dollars in the 12 months ended October, with the rest funding investments in customers including…
## Huang may have fought commoditization
Nvidia's customer financing and multibillion-dollar credit guarantees for hyperscaler projects are questioned as circular financing.
## Board prioritised reputation over shareholders
A former CEO argues the Nvidia board made a mistake by forcing Huang's resignation instead of punishing him with equity or bonus removal.

> You can't just plug and play to replace someone so critical to the creation of a company's one-of-a-kind products and operation.
## Two trillion dollar loss may be permanent
The market's two trillion dollar valuation cut may reflect lasting damage rather than panic selling.Investors judge that Nvidia's margins and profit growth will be far lower in the future without Huang to hold off commoditization.
## Key takeaway

Nvidia's stock fell 34% after CEO Jensen Huang's resignation on November 12, cutting two trillion dollars from its market value, but experts say the discount reflects justified concerns about the company's ability to maintain its competitive edge without him.