Investor Michael Burry, famed for predicting the 2008 housing crash, is now betting against Nvidia Corp. (NASDAQ:NVDA), warning that the AI-driven chip boom is vulnerable to a sharp reversal.
Burry Calls Nvidia ‘Purest Play’ On AI
In a Substack post over the weekend, Burry said he is shorting Nvidia because the chipmaker is "simply the purest play" on artificial intelligence and is dangerously reliant on hyperscaler spending.
"I do not see how that math works," he wrote, adding that Nvidia could sell about $400 billion worth of chips this year while there are "less than $100 billion in application layer use cases."
Burry said Nvidia is "the most loved, and least doubted," making it an attractive short because expectations leave little room for disappointment.
Why Burry Avoids Shorting Other Big Tech
Burry explained that betting against Meta Platforms Inc. (NASDAQ:META), Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL), or Microsoft Corp. (NYSE:MSFT) would mean wagering against their dominant core businesses.
Shorting Meta would be "shorting its social media/advertising dominance," while betting against Microsoft would be "shorting a global office productivity SaaS goliath," he wrote.
Those companies, Burry said, are not "pure shorts on AI" and could absorb losses if AI spending slows.
He also warned of technological obsolescence at Nvidia, noting the company introduces new chip solutions every year or less, raising the risk of future writedowns.
Burry Warns On AI Spending, Tech Risks, Power Constraints
On Monday, Burry criticized Meta after Chief Executive Officer Mark Zuckerberg announced plans to sharply expand AI capacity, warning the company was abandoning its asset-light model for a capital-heavy strategy that could hurt returns.
Burry said Meta was "throwing away its one saving grace" and cautioned that return on invested capital could fall as spending accelerates.
Earlier, Burry also turned bearish on Oracle Corp. (NYSE:ORCL), saying he owned put options and had shorted the stock as the company expanded into cloud computing and took on more debt.
Oracle shares were down about 40% from their September peak.
Separately, Burry urged President Donald Trump and Vice President JD Vance to fast-track a $1 trillion nuclear power and grid expansion to meet rising AI-driven electricity demand.
He warned that energy shortages could constrain innovation and economic growth, a concern echoed by Futurum Group CEO Daniel Newman, who said regulatory delays posed the biggest risk to sustaining the AI boom.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo: Michael Vi / Shutterstock
