Nvidia CEO, Jen Hsun Huang, goes to the collection. Despite the turbulent times for the company, a leader in the semiconductor sector and symbol of the artificial intelligence boom (IA), Huang made a profit of $633 million in just two months, selling more than 5 million shares.
Between June and early September, the founder and CEO has sold 5,3 million shares, in tranches of 120.000 each, for a total of 633,1 million dollars. There's no secret here: these sales are part of a predefined trading plan, known as Rule 10b5-1, which allows insiders to sell shares following a set schedule, minimizing the risk of accusations of misuse of confidential information.
Despite Huang remains the company's largest individual shareholder, with approximately 3,5% of shares outstanding, the sale of a significant portion of its holding has alarmed investors. Many see this move as a caution sign regarding the future of the company, even though the CEO still holds a significant stake, equal to approximately 93 billion dollars.
Jensen Huang: The 18th Richest Man in the World
Jensen Huang, founder and CEO of Nvidia, can boast a personal fortune estimated at around $94,2 billion, a staggering increase of $50 billion since the beginning of the year alone, according to the Bloomberg Billionaire's Index. This places him at the 18th place among the richest people in the world.
Despite the immense wealth he has accumulated, Huang has continued to sell shares of his own company. The transactions have been carried out regularly in recent months and reported in official documents filed with the Securities and Exchange Commission (SEC).
For example, on September 3, Huang sold 120.000 shares of Nvidia at an average price of $110,76 each, netting a total of $13,29 million. Before that, on August 8, he sold another 120.000 shares at an average price of $104,83, for a total of $12,57 million. In July, he made several similar trades, such as the one on July 26, in which he also sold 120.000 shares at an average price of $113,54, netting a total of $13,62 million.
Sales continue to be carried out in batches of 120.000 shares, with prices varying by day. In mid-July, for example, Huang sold for an average price of $119,17, bringing in $14,3 million.
All this happens in the midst of recent difficulties that Nvidia stock is facing.
Nvidia Stock Crisis
Nvidia stock, after recording a spectacular growth of 116% since the beginning of the year, has suffered a sharp decline in recent weeks. From the peak reached, the The stock has lost about 11% in three monthsThe fall was accentuated on September 3, 2024, when Nvidia recorded a loss in value of 9,5% in a single day, wiping nearly $10 billion from Huang's net worth.
This decline is partly attributed to growing investor concerns about sustainability of the artificial intelligence boom, despite the recent financial results have been above expectations. During the second quarter, Nvidia reported revenue of $30,04 billion, well above the forecast of $15 billion, with profits of $16,59 billion. However, doubts remain about the ability of AI to generate long-term profits.
The Antitrust Investigation
Another factor that contributed to Nvidia's recent crisis concerns the possible repercussions following the Antitrust investigations. According to Bloomberg, Nvidia has been subjected to an investigation by the U.S. Department of Justice, with the aim of vverify any anti-competitive behavior. Although Nvidia said it had not received an official subpoena, the news further unsettled investors, who were already worried about the company’s plummeting stock price.
The investigation could impact the company’s ability to maintain its dominant position in the market for AI chips, a technology that is increasingly crucial to industries such as cloud computing, data centers and industrial automation.
An uncertain future for AI?
One of the main reasons for uncertainty concerns the inflated expectations related to artificial intelligence. Nvidia has become a benchmark in the industry thanks to its graphics chips, which are essential for training AI models. However, the rapid growth in expectations may not be sustainable. Many investors fear that the AI market may have peaked too early and that the expected profits are slow to materialize.
Nvidia's success is inextricably linked to the advancement of AI, but with a rapidly evolving technology landscape, competition is fierce. Rival companies are investing heavily in alternative solutions, and it's unclear whether Nvidia can maintain its competitive edge.
