Michael Burry became a popular voice in the investing community after he correctly predicted the 2008 mortgage crisis, shorted the market, and made a fortune. Although he closed his management fund last year, he continues to invest and share his market views in prominent social media posts.
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Burry has recently been critical of the artificial intelligence (AI) build-out, and putting his money where his mouth is, he’s betting against Nvidia (NASDAQ: NVDA), Palantir Technologies (NASDAQ: PLTR), Tesla (NASDAQ: TSLA), and Micron Technology (NASDAQ: MU). Is he right?
1. Nvidia
Burry first disclosed Nvidia puts in the first quarter of 2025. He has compared the current AI situation to the dot-com bubble that burst in 2000 and named Nvidia the star player.
He has two main arguments. First, he says the chips aren’t being depreciated properly, and their usable lifespan will be shorter than anticipated.
The second concerns Nvidia’s circular financing. Nvidia has many mutually beneficial relationships with other companies, such as its agreement with CoreWeave, in which it has a large stake and which is buying Nvidia’s chips.
His musings set off a firestorm between him and Nvidia, which shot back with a seven-page defense. Burry’s reaction was, “I stand by my analysis. I am not claiming Nvidia is Enron. It is clearly Cisco.” The difference being that Enron was a shell company used to manipulate investors, while Cisco’s business simply dried up after the dot-com bust.
Is he right? The bull thesis looks strong for Nvidia. It is at the center of AI, and AI continues to develop, with unceasing demand. So far, the hyperscalers are thriving.
What I like about Nvidia is that it’s not only an AI company, and that its chips are likely to fuel whatever the next chapter in technology is. However, I would heed Burry’s cautions, and at this point, I wouldn’t make Nvidia a central position in my portfolio.
2. Palantir
Burry first bought Palantir puts in the third quarter of 2025. Unlike the Nvidia position, he doesn’t seem to have a problem with Palantir’s business; he just thinks it’s “wildly overvalued” and that its fundamental value is less than $50 per share.
As of this writing, Palantir stock trades at $201, which is 171 times trailing-12-month earnings and 84 times trailing-12-month sales. It is the most expensive stock in the S&P 500 (SNPINDEX: ^GSPC) on a price-to-sales basis and has one of the highest P/E ratios in the index.
