San Francisco, CA – Nvidia CEO Jensen Huang experienced a dramatic $10 billion drop in his net worth on Tuesday, following a historic decline in Nvidia’s market value. Huang’s wealth, which stood at $94.9 billion after the setback, saw its largest single-day drop ever, while Nvidia’s market capitalization fell by $279 billion, marking the biggest one-day loss ever recorded for a U.S. company.
The steep decline in Nvidia’s share price, which fell nearly 10%, was triggered by the company’s disappointing quarterly forecast that failed to meet investor expectations. The forecast dampened the previous optimism surrounding Nvidia’s role in artificial intelligence (AI) technology, contributing to a broad sell-off in the company’s stock.
Despite the substantial one-day loss, Huang’s wealth has still grown significantly this year. According to the Bloomberg Billionaires Index, he has seen an increase of $51 billion in his net worth so far in 2024. This growth highlights the volatile nature of tech stocks, where rapid gains can be offset by equally significant declines.
Nvidia’s woes were exacerbated by reports of increased scrutiny from the U.S. Justice Department. The department has issued subpoenas to Nvidia as part of a rising antitrust investigation. The probe is focused on Nvidia’s dominance in the AI chip market and concerns that the company may be engaging in practices that hinder competition, such as penalizing customers who do not exclusively use its AI chips.
The investigation and the disappointing earnings forecast contributed to a sharp investor reaction, overshadowing Nvidia’s leading position in AI technology. The significant loss in market value surpasses the previous record held by Meta Platforms (formerly Facebook), which saw a $232 billion drop in February 2022 after issuing a weak forecast.
Nvidia has defended its market position, attributing its dominance to the superior performance of its products and its critical role in the global tech supply chain. The company maintains that its chips are among the best in the industry, which has secured its place as a vital partner for some of the world’s largest corporations.
As Nvidia navigates these challenges, the stock market’s response underscores the growing caution among investors regarding the future of AI technology and the regulatory pressures facing major tech firms.
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