Arm shares drop 6% on Nvidia leadership speculation

Arm Holdings ADR shares fell 6.0% to $187.77 in midday trading after reports that Nvidia's board approached Arm CEO Rene Haas as a leading candidate to replace Jensen Huang, who abruptly resigned on November 12, raising concerns about Arm's leadership stability. The speculation adds uncertainty to Arm's already fragile position following its November 4 earnings report, where royalty revenue growth of just 8% missed the company's 13% guidance despite total revenue rising 27% to a record $1.44 billion. The stock still trades at roughly 90 times forward earnings, leaving it highly sensitive to negative news, with implied volatility surging and put skew steepening as institutional hedging increases. The broader market added pressure, with the NASDAQ falling 1.4% and the S&P 500 dropping 0.9% as Nvidia's leadership shock rippled through semiconductor and AI infrastructure sectors. Arm's intraday low of $180.50, well below its opening price of $196.48, reflects how quickly investor sentiment shifted, with the stock already in a downtrend from its 52-week high of $452.70.