Jensen Huang exits Nvidia, shares drop 13% as AI empire faces scrutiny

Nvidia shares plunged 13% in early trading after the departure of Jensen Huang, the Guardian reports. The company designs and sells the graphics processing units that underpin the AI economy — without them, models like ChatGPT and Claude could not be trained or run. That position has made Nvidia the world's second-most valuable company, and at times the most valuable of all.

Nvidia is not alone in designing AI chips. Microsoft, Meta and Google are all building their own, and Google's tensor processing units appear at least as good as Nvidia's, and better for some jobs. What made Nvidia hard to replace, per the Guardian, is the web of relationships Huang personally led — including 2025 meetings with Mohammed bin Salman, Keir Starmer and Emmanuel Macron to push 'sovereign AI', followed by supply deals. One such arrangement promised 260,000 advanced chips to South Korea, with delivery dates, payment terms and buyers never made clear.

Huang's Nvidia also became known as the 'central bank of AI'. It financed a set of companies dubbed 'neoclouds' to buy its chips, house them in datacentres and rent them out to the biggest AI firms — keeping datacentre risk off Nvidia's own balance sheet while propping up demand. It invested in AI startups that could become future customers and offered large sums to companies including OpenAI to spend on its chips. All of it runs to hundreds of billions of dollars, cycling through a limited set of accounts.

Then there's TSMC. The Taiwanese manufacturer produces the overwhelming majority of the world's AI chips and has no real competitor, because the process is one of the most expensive and difficult industrial feats ever built: lasers in the extreme ultraviolet spectrum etch nanometre lines into each chip. Even after two decades of refinement, TSMC still gets only a 60% yield on its most advanced chips — 40% come off the line defective. Nvidia helped develop TSMC's processes, a tie that reportedly began with a personal letter Huang wrote to the chipmaker's chief executive in 1997.

The opacity cuts both ways. Investigators tracing Nvidia's supply chain hit secretive contracts and tangled export records, and open questions remain about who sits in the years-long queue for chips, in what order, and how many have actually shipped. The Guardian points to Megaspeed, a small Singaporean firm that got cutting-edge GPUs while others struggled. Its executive Alice Huang was later revealed to have had an affair with Nvidia's chief executive and to be an alleged Chinese spy, per the outlet — a relationship that appears to have helped Megaspeed secure roughly $7.5bn (£5.67bn) worth of Nvidia chips, allegedly smuggled into China.

A new chief executive could bring transparency and predictability to chip contracts and supply chains, the Guardian suggests. But that same scrutiny could expose what sits inside those contracts: elaborate debt structures and handshake agreements that have so far stayed hidden. The outlet notes Huang dazzled heads of government in his leather jacket, selling them on his technology as the key to transformation and power.