Key facts
- Michael Burry has taken short positions on AI-focused companies Oracle and Nebius.
- He expressed concerns about AI companies gorging on liabilities and becoming overvalued.
- Burry shorted Oracle at about $145 and Nebius at around $212 per share.
- Oracle's stock has fallen significantly amid concerns over its data center buildout debt.
- Nebius' stock has seen substantial gains this year despite Burry's short position.
Michael Burry, the investor famously known for predicting the 2008 housing crisis, has revealed he is shorting shares of Oracle and Nebius, two companies heavily invested in the artificial intelligence boom. Burry articulated his bearish stance in a Substack post, comparing the current state of AI companies to 'fish in a barrel' that have become over-leveraged with off-balance sheet liabilities and are poised for a significant fall.
Burry stated he initiated his short on Oracle stock at approximately $145 per share. The enterprise software giant's stock had experienced a substantial surge, climbing from below $130 to nearly $350 between April and September of the previous year, driven by demand for its cloud infrastructure amid the AI frenzy. However, the stock has since declined by nearly 60% due to growing concerns about the company's significant debt accumulation for its data center expansion.
Regarding Nebius, Burry disclosed a larger short position at around $212 a share. The AI cloud infrastructure firm's stock fell 13% to $190 on Thursday, though it saw a 5% rally in premarket trading on Friday. Despite this, Nebius shares have more than doubled this year and have increased approximately ninefold over the past two years.
Burry has been a vocal skeptic of the AI buildout, warning that major technology firms might be overinvesting in rapidly obsolescent microchips and data centers. Bulls, conversely, highlight the rapid growth rates of AI companies. Oracle's remaining performance obligations, a metric for future contract revenue, surged 363% to $638 billion for the year ending May 31. Nebius reported its revenue nearly sevenfold year-on-year in the first quarter to almost $400 million, with deferred revenue rising about 150% to $686 million by March 31.
Burry previously expressed concerns about Oracle's financial health, describing it as being 'in a bit of a pickle' and predicting a potentially 'tragic fall.' He had previously exited a bearish wager on Oracle using put options in August, noting substantial profits, but indicated he might re-enter if volatility decreased. Earlier in January, he had shorted Oracle during the latter half of 2025, citing an inexplicable and unnecessary AI strategy and unfavorable company positioning.
In discussions related to his latest post, Burry highlighted Nebius' 'ton of execution risk,' pointing to the high costs and long leases associated with data center operations and the challenge of securing long-term customer commitments.