Nvidia Drops as Tom Lee Calls a Bottom for Tech

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•  12 Nov 2026
 

$NVDA Nvidia shares fell about 10% today after the board announced that Jensen Huang would step down as CEO and president and leave the board. Tom Lee, head of research at Fundstrat, told clients today that he still believes technology stocks bottomed last week and that the departure leaves his view intact. Nvidia named CFO Colette Kress interim CEO while it searches for a permanent successor. The market capitalization of Nvidia had already fallen below $4 trillion in premarket trading.

The departure followed days of reports about extramarital relationships, including one reportedly involving a woman suspected of being a Chinese agent. The board opened an independent inquiry before Huang stepped down. Nvidia said it had no reason to believe that trade secrets or national security had been compromised.

Huang founded Nvidia in 1993 and led it for more than three decades, turning a maker of graphics cards for computer games into the leading global supplier of AI chips. Kress has served as CFO since 2013 and is familiar to investors from earnings calls. The market is already looking for a permanent successor, and some investors attribute the continued decline in the stock to that uncertainty.

Lee attributes the sector bottom to the wave of forced selling and the collapse of several prominent hedge funds last week. He describes the episode as a kind of black swan event that produced a bottom within the sector. Hedge funds typically hold market-neutral portfolios with long and short positions that offset each other. When a fund has to liquidate all its positions at once, it sells even strong stocks indiscriminately, and prices fall faster than business fundamentals justify.

Calling a bottom in real time is difficult. During the selloffs of August 2024 and April 2025, technology stocks made several failed attempts to recover before resuming their climb and reaching new highs. Investors who bought on the first day of the decline often faced another drop of several percentage points along the way.

The Nasdaq 100 is about 9.5% below its October intraday high and has lost more than 7% over the past month. The sector has declined amid doubts about how long companies can sustain the pace of AI investment as borrowing costs rise. The market also expects the new Congress, with a Democratic majority, to tighten oversight of data center construction.

Chip stocks moved in different directions today. Advanced Micro Devices gained about 2%, and Broadcom rose about 5%. The divergence suggests some investors are distinguishing between the leadership crisis at Nvidia and demand for AI chips.

Lee founded Fundstrat in 2014 after serving as chief equity strategist at JPMorgan and is regarded as one of the more bullish voices on Wall Street. Over the past year, he has also become associated with crypto as chair of BitMine, a company that accumulates ether on its balance sheet. His calls have sometimes taken longer to play out than he expected, and he tends to identify market turning points during periods of panic.

Lee says markets tend to bottom amid bad news. He does not expect a sharp rebound today. If his analysis is right, he sees this as the time to increase exposure to technology stocks.

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