AMD Stock Rallies as 'Godfather of AI' Jensen Huang Leaves Nvidia
In 1993, a young Stanford University graduate co-founded a small graphics-chip startup in Silicon Valley. His name was Jensen Huang.
Thirty years later, Wall Street had given him a new nickname: the “Godfather of AI.”
On Thursday, 33 years after founding it, Huang resigned from Nvidia Corp. (NASDAQ:NVDA). The biggest winner on Wall Street was his closest rival.
Advanced Micro Devices Inc. (NASDAQ:AMD) rose 2.9% to $568.93 in early trading Thursday. Nvidia fell 6.7% to $162.06, after touching $148.80 at the open.
Huang also left the company’s board. Harvey Jones, the former CEO of chip design company Synopsys, was named Nvidia’s first-ever board chair, while Chief Financial Officer Colette Kress will serve as interim CEO and keep her CFO role.
AMD Has Nearly Erased Nvidia’s ChatGPT Lead
One chart tracks the AI chip race: Nvidia’s share price divided by AMD’s.
On Nov. 30, 2022, the day ChatGPT launched, that ratio stood at 0.22.
Nvidia then raced ahead. By Feb. 26, 2025, the ratio had climbed to 1.25. At that point, Nvidia had outperformed AMD by about 475% since ChatGPT’s debut.
On Thursday, the ratio fell to about 0.28, its lowest level since May 2023.
As a result, AMD has clawed back about 93% of the lead Nvidia built over the AI boom.
In absolute terms, Nvidia is still up 858% since ChatGPT’s launch, against 633% for AMD.
Nvidia-to-AMD share price ratio, daily. Source: TradingView
Why Traders Are Buying AMD
The bet is simple. AMD and Broadcom Inc. (NASDAQ:AVGO) gained on wagers that Nvidia’s troubles could send more chip business their way.
The move started before the announcement. AMD rose nearly 4% after hours on Wednesday, after The Wall Street Journal reported that Nvidia’s board was preparing to remove Huang, and stayed higher in Thursday’s premarket session.
It also comes after a rough patch. AMD closed at a record $649.42 on Oct. 6, then slid about 38% to $404.40 by Nov. 5, two days after its third-quarter report, before rebounding about 41%.
Meanwhile, Lisa Su‘s name has entered the Nvidia succession debate. The Information has floated the AMD CEO and Arm CEO Rene Haas as unconventional possibilities, and Nvidia said its board will consider internal and external candidates. Su and Huang are first cousins once removed, according to Taiwanese genealogist Jean Wu.
“This was Lisa at her best. This is a company that’s executing very well,” Jay Goldberg of Seaport Research Partners said on a recording of The Circuit podcast last week. Goldberg is the only analyst with a “sell” rating on Nvidia.
Wall Street Splits on Nvidia Without Huang
Bernstein downgraded Nvidia to Market Perform and cut its price target by half, from $400 to $200.
“With the new allegations, it feels impossible to us for the board to keep him in the role,” Bernstein analysts said.
Yorkville Ives analyst Dan Ives cut his price target to $225 from $300, now valuing Nvidia without Huang as CEO.
Others see the business intact. “We doubt the distraction created by the CEO’s indiscretions alters the fundamentals,” Raymond James analyst Simon Leopold said.
Kress faces her first test quickly. Nvidia reports quarterly earnings on Tuesday, Nov. 17.
By then, the gap Nvidia opened over AMD after ChatGPT’s launch could be almost gone.
AMD Price Action: Advanced Micro Devices shares were up 2.90% at $568.93 at the time of publication Thursday, according to Benzinga Pro data.
Photo: Samuel Boivin / Shutterstock