After a CEO departs suddenly, share prices often react differently across trading sessions.
NVIDIA is the highest-valued company in the market, and it has now abruptly lost the leader deeply tied to its fate — but it is far from the first case.
Apple lost Steve Jobs, both founder and savior, who died of cancer.
McDonald's abruptly fired Steve Easterbrook over an improper relationship with a subordinate.
Nissan removed Carlos Ghosn as chairman in 2018 after he was arrested in Tokyo and charged with financial misconduct and underreporting income.
In investing circles, the risk created by losing a core leader is called key person risk.
Many companies have seen hundreds of millions of dollars in market value evaporate after a core executive left.
There are exceptions, of course: Wynn Resorts saw its shares rise 8% the day after its namesake founder, Steve Wynn, stepped down over sexual assault allegations.
Leadership researchers say companies that recover faster tend to choose the right successor — usually an experienced operations manager rather than a visionary dreamer, and someone willing to push through difficult reforms.
James Citrin, who leads the global CEO practice at executive search firm Spencer Stuart, said: "There is no one-size-fits-all succession plan. The most important keyword is credibility."
Below are three case studies:
Apple
Steve Jobs
As a creative genius, Jobs had unmatched influence inside Apple, to the point that some employees' personalized license plates carried the initials for "What Would Steve Jobs Do?"
His successor, Tim Cook, dispelled outside doubts by relying on his reputation as an operations master and adopting a more cautious and steady management style.
Employees recalled that Cook often said: "Let's see how we can move this forward." That was completely different from Jobs' habit of directly rejecting ideas.
Compared with Jobs, Cook was more willing to share decision-making power with the team and delegate some creative decisions to others.
Early in his tenure, Cook introduced measures that were well received by the market, such as launching dividends and share buybacks in 2012.
One year after Steve Jobs stepped down: individual stock versus index performance comparison.
Jeffrey Sonnenfeld, a management professor at Yale University, said Cook also had an advantage at the time: he could seek advice from experienced CEOs on Apple's board, including Bob Iger of Disney and Mickey Drexler of Gap.
But Sonnenfeld said NVIDIA's situation is different, because many of its current directors lack long-term experience running a public company.
(Trump was one of those who publicly suggested Cook replace NVIDIA CEO Jensen Huang. He posted on Truth Social: "A legend replaces a legend!")
Uber
Travis Kalanick
When Uber chose Dara Khosrowshahi, then CEO of Expedia, to take the helm in 2017, the once high-flying startup was mired in multiple crises.
Its flamboyant co-founder, Travis Kalanick, had resigned about nine weeks earlier after a group of investors joined forces to push him out.
A large number of allegations involving sexism and workplace harassment had badly damaged Uber's reputation.
By contrast, Khosrowshahi was known for being calm and restrained, and had a track record of running profitable companies.
The board tasked Khosrowshahi not only with repairing Uber's corporate culture, but also with setting a deadline to complete an IPO in 2019.
That meant he had only a few short months to start curbing the company's billions of dollars in losses.
Soon after taking office, he built his own management team; after the IPO underperformed expectations, he further adjusted the leadership ranks.
Alex Kirss, a human resources business analyst at Gartner, said: "A CEO transition is never just about changing the top leader; it also requires adjusting the core team around that person."
Uber's workplace standardization reforms required balance.
Khosrowshahi said he understood he had to drive change, but could not force out the talent he wanted to keep or abandon the traits in Uber's culture that made it vibrant.
In a 2022 podcast interview, he said: "I came here to make a turn, not to deny everything you did in the past."
Nissan
Carlos Ghosn
After Renault and Nissan formed their alliance in 1999, one person maintained the balance of power between them: Carlos Ghosn.
The Brazilian-Lebanese Renault executive devised a turnaround plan that pulled Nissan back from the brink of bankruptcy, and eventually ran both companies at the same time.
Although this complex partnership was often full of friction, Ghosn's tough style and concentrated power kept the alliance stable.
In 2018, Ghosn was ousted over financial misconduct allegations, and later staged a dramatic escape from Japan to avoid prosecution.
His departure left both companies in a power vacuum, with talent draining away and internal struggles erupting.
One year after Carlos Ghosn's arrest: individual stock versus index performance comparison.
Since 2019, Renault has changed CEOs three times.
Nissan has also gone through multiple management turnovers and strategic shifts, including the collapse of a merger plan with Honda, and it remains deep in a new round of self-rescue efforts to return to profitability.
The Renault-Nissan alliance has survived, but the terms of cooperation have been renegotiated.
Yale's Sonnenfeld said the two companies did agree on one thing: "They have all distanced themselves from Carlos Ghosn."
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