Nvidia CEO Resigns. What Happens to Stock Prices One Year After a Leader Departs?

Hello everyone! I am Uta, a salaryman working in research.

Suddenly, what do you think happens to a company’s stock if the leader who has steered it for 33 years suddenly disappears one day?

That is exactly what happened this week. It is Nvidia, the world’s number one company for AI semiconductors.

On the day the resignation was announced, the stock price opened down 13.1%.

Incredibly, that means more than 10% of the market capitalization vanished at the start of the day. However… the closing price for the day recovered to -4.3%.

Chart: Recovered from -13% in the morning to -4% at the close (Data: Yahoo Finance, Market Cap: CNBC)

Today, after briefly organizing what happened, we will look at data to see how the stock prices of 8 companies that lost their leaders in the past performed, and then examine the current issues and future points of interest.

What happened? Leadership changed in 5 days

Chart: Leadership changed in 5 days (Source: CNBC, Nvidia announcement)

On November 12, US time, Nvidia announced that founder Jensen Huang had resigned as President, CEO, and Director (Company announcement, SEC 8-K filing).

• The interim CEO is CFO (Chief Financial Officer) Colette Kress. She will also continue as CFO.

• For the first time, a ‘Chairman’ has been appointed to the Board of Directors (Harvey Jones).

• A permanent CEO will be sought from both inside and outside the company. No timeline was provided.

According to reports, the Board of Directors decided on his departure on the night of the 11th following a series of reports regarding Huang’s personal life (such as relationships with employees) (CNBC). Suspicions related to US export controls and national security have also been reported, and the Board has requested an investigation by a law firm. However, the Board explained that ‘there is no reason to believe that national security or company secrets have been compromised’ (→ The content of these suspicions is at the reporting stage and is not a verified fact).

Stock price down 31% in one month from October high

Chart: Down 31% in one month from October high (Data: Yahoo Finance)

In fact, the stock price had been falling even before the resignation. The high was $239.24 at the close on October 6, and it was $166.19 on November 12. That is -30.5% in about one month.

According to CNBC, the market capitalization has decreased by about $2 trillion from its October high, and it has ceded the top spot in the world to Apple. Meanwhile, record-breaking buying by individual investors was reportedly seen on the morning of the resignation.

The 8 past companies: Most moved within ±4% the next day

So, how did the stock prices of companies that lost their leaders in the past perform? Let’s look at the data, not just intuition! We examined the movement on the next business day after the announcement for 8 companies where the departure of a founder or a departure due to a scandal became a topic of discussion.

Chart: The day after the announcement, most were within ±4% (Data: Calculated from Yahoo Finance)

• The biggest drop was Oracle (2014, Mr. Ellison) at -4.2%

• Microsoft (2000, Mr. Gates) was conversely +4.1%

• Intel (2018), which saw its leader resign due to relations with employees, was -2.4%, and McDonald’s (2019) was -2.7%

Nvidia’s closing price of -4.3% is about the same as the 8 companies. However, the -13.1% in the morning was a larger movement than any of the 8 companies.

What about one year later? 3 out of 8 companies outperformed the S&P 500

Chart: 3 out of 8 companies outperformed the S&P 500 one year later (Data: Calculated from Yahoo Finance)

Comparing the stock price one year later with the S&P 500 for the same period,

• Outperformed: Apple (+57.8 points), Alphabet (+22.4), McDonald’s (+4.5)

• Underperformed: Microsoft (-41.4), Amazon (-29.3), Starbucks (-20.8), Intel (-15.6), Oracle (-8.6)

The results are mixed. (→ Microsoft’s 2000 coincided with the collapse of the IT bubble, and Amazon’s 2021 announcement was on the same day as its earnings report. It is not just the impact of the leadership change.)

This is what I thought was most important as a researcher. With 8 companies, you cannot say that “when the leader leaves, the stock goes down” or “it goes up”. With only 8 companies and other events overlapping, you cannot predict the future with these numbers. I felt it was natural to see that what determined the outcome one year later was not the leadership change itself, but the business figures that followed.

Four issues ahead

Chart: Four issues ahead (Source: CNBC, Nvidia announcement, Yahoo Finance)

So, what issues does Nvidia face going forward? Organizing from reports, there are four.

1. The successor CEO has not been decided

The board of directors says they are looking both inside and outside the company, but they have not indicated a timeline. Analyst Dan Ives believes it is highly likely that Mr. Kress will serve as interim for about a year, and then they will bring someone in from outside (CNBC). Names such as Ian Buck have also been mentioned as internal candidates.

2. Congress and investigations

Congress is seeking testimony from Mr. Huang regarding semiconductor export restrictions to China and other matters. The House committee chair said he “agreed to testify before Thanksgiving,” and the Senate chair requested testimony for early December. The schedule has not been finalized yet (CNBC, Yahoo Finance). The board of directors has also requested a law firm to conduct an investigation.

3. Possibility of follow-up reports

Bernstein analyst Stacy Rasgon expressed the view that it is difficult to recommend buying heavily right now because more allegations could emerge (CNBC). In fact, new reports have surfaced even after the resignation (Yahoo Finance).

4. “The Leadership Vacuum Discount”

KeyBanc analysts state that the departure of the top executive increases risk, and the stock’s valuation metric (P/E ratio) should be lower. Several brokerage firms have downgraded their investment ratings or valuations (CNBC).

On the other hand, a portfolio manager at Janus Henderson points to the possibility that this event marks the “clearing of bad news” and highlights the certainty of the 2027 outlook (CNBC). Opinions are divided.

Points to watch: First, the November 17 earnings report

Chart: The first focus is the 11/17 earnings report (Source: Nvidia announcements, CNBC, Yahoo Finance)

The nearest major event is the earnings report on Tuesday, November 17 (US time) (Wednesday morning in Japan). The company states it will announce as scheduled, and this will be the first earnings report under interim CEO Kress.

These are the three things to watch:

1. Whether revenue and profit margins fall within the company’s guidance: The guidance provided in the previous earnings report was revenue of $108 billion ±2% and a gross margin of 74.0% ±0.5 percentage points (assuming zero revenue from data centers for China).

2. Outlook for the next quarter: Whether customer orders continue even without the top executive.

3. Explanations regarding the successor and the investigation: How much will be discussed during the earnings call?

In the company’s announcement, Board Chair Jones stated, “The business, commitments to customers, and product plans are expected to continue without interruption.”

Business figures: Revenue has increased 8-fold in 3 years

Chart: Revenue has increased 8-fold in 3 years. Performance to date (Data: Yahoo Finance)

Revenue for the fiscal year ending in January went from $27 billion → $60.9 billion → $130.5 billion → $215.9 billion. It has increased 8-fold in 3 years. Operating profit is $130.4 billion.

Even if the top executive changes, the products and customers that created these figures will not change overnight. The trailing P/E ratio calculated based on the closing price on November 12 is approximately 21x.

What changes and what does not

Chart: What changes and what does not (Source: CNBC, Nvidia announcements, Yahoo Finance)

• What changes: The face of management. The search for a successor, the investigation, and congressional responses will continue, and stock prices are likely to fluctuate with follow-up reports.

• What does not change (for now): Earnings schedule, product plans, and revenue performance.

This is not someone else’s problem for Japanese investors either. Nvidia is a stock that is heavily included in funds popular with NISA, such as investment trusts linked to the S&P 500 and Nasdaq 100.

Thought Log: Don’t jump to conclusions based on ‘a single event’

Research does not say ‘this is what will happen’ based on a single case. This time, even when looking at the 8 companies from the past, the results one year later were all over the place. Moreover, because other events overlapped, it became clear that it is difficult to isolate the impact of a leadership change alone.

That is precisely why, rather than the magnitude of the news, I wanted to look at ‘things that can be verified,’ such as the financial results and the company’s outlook range.

Summary

• Nvidia’s Mr. Huang resigns as CEO. Stock price opened at -13.1% and closed at -4.3%.

• For the 8 companies where leaders left in the past, the next day was generally ±4%, and one year later, the results were mixed.

• Future issues include the successor, parliamentary investigations, follow-up reports, and P/E ratio discounts. First, keep an eye on the earnings report on 11/17.

✅ To-do list you can start today

Finally

Thank you for reading until the end!

In this note, I write articles that ‘verify with data’ about investment and life from the perspective of a salaryman working in research.

Check this out next as well👉 Down 9.5% in 2 days due to CEO investigation. Has Nvidia’s earning power changed? (This refers to the figures at the time the investigation was reported, just before the resignation.)

If you found this helpful, it would be a great encouragement if you could ‘like’ and follow!

References

• NVIDIA ‘NVIDIA Announces CEO Transition’ (SEC Form 8-K, 2026/11/12) https://www.sec.gov/Archives/edgar/data/0001045810/000104581026000082/nvidiaannouncesceotransiti.htm

• CNBC ‘Nvidia CEO Jensen Huang resigns: Live updates’ https://www.cnbc.com/2026/11/12/nvidia-jensen-huang-ceo-live-updates.html

• Yahoo Finance ‘Nvidia live updates: Following Jensen Huang’s resignation as CEO’ https://finance.yahoo.com/technology/live/nvidia-live-updates-following-jensen-huangs-resignation-as-ceo-allegations-of-a-third-affair-emerge-195535310.html

• RoboForex “Nvidia Earnings Date: 17 November Scenarios, Interim CEO” (Outlook presented in the previous earnings report) https://roboforex.com/blog/analysis/nvidia-earnings-date-interim-ceo-scenarios/

• Stock price, financial, and P/E ratio data: Yahoo Finance (Retrieved via yfinance on 2026/11/13 at 22:00. US data is based on the closing price of 11/12. For the 8 past companies, calculations are based on the closing price on the announcement date, comparing the next business day and 252 business days later.)

*This article is for informational purposes only and does not recommend the buying or selling of any specific stocks or financial products. The figures stated are based on data at the time of writing and do not guarantee future results. Investing involves risk, and the principal is not guaranteed. Please make investment decisions at your own discretion.