Jensen Huang is worth about 30% of Nvidia’s total value.
That’s according to prominent tech bull Dan Ives, who said on Tuesday that Huang’s departure from the AI chip titan would whittle its value by nearly a third.
Huang is embroiled in a scandal related to an affair with a suspected Chinese spy. The woman, Alice Huang, has been an executive at Singaporean data firm Megaspeed, a company with ties to big Chinese tech firms.
If Huang were to depart, Ives said that Nvidia stock would fall 25% to 30%, implying a drop to around $122 per share.
“We believe if Jensen was removed as CEO, Nvidia is worth a lot less (25%-30%) as a company/stock and would change the future direction of the company and create a dramatically different competitive environment around AI GPUs both in the US and globally especially for China,” Ives, a senior managing director at Yorkville Ives, wrote in a note.
Nvidia shares were hit by a broader panic in the AI trade last week, with Huang’s affair the latest headwind pushing against the price. The stock has tumbled 25% from its early October peak, and is down 8% year-to-date.
Ives pointed to the “key man risk,” the idea that much of Nvidia’s value is pegged to the visibility and image of Jensen Huang. There is no publicly known succession plan at Nvidia.
“Jensen is the core DNA of Nvidia and its AI success and ambitions are heavily tied to him staying on as CEO. Jensen is not replaceable,” Ives said. “There is no other person on the management team bench that can step in seamlessly as CEO.”
The dilemma extends to the broader stock market and the economy, as well. Nvidia, which was the world’s largest company by market-cap before the recent stock slide, has been a pillar of the AI-led bull market.
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The chipmaker was overtaken by Apple as the world’s most valuable company, with its market cap falling below $5 trillion amid the post-election rout and Huang’s affair.
CEOs have sometimes weathered relationship scandals that public. Jeff Bezos, notably, stayed on as Amazon CEO after his affair with Lauren Sanchez was exposed in 2019, though former leaders at Astronomer, Nestlé, Kohl’s, Intel, and McDonald’s have been outed after similar developments. Huang’s episode differs, as his relationship with a Chinese national has potential national security implications.