Michael Burry boosted his bet against Nvidia stock on July 25, when shares traded around $210.28, adding to the $186 million short position he opened in Q3 2025. This bet came just as Nvidia's shares started falling sharply from July 22, reflecting growing skepticism about the chipmaker's valuation amid market volatility.
By July 28, Nvidia's stock slid further to $193.45, marking a weekly loss of over 6% and pushing the monthly performance into the red. Though Burry’s options trades from last year might not yet be profitable, the recent decline aligns with his persistent caution over the artificial intelligence sector’s unstable boom.
Burry’s Doubts on AI Boom and Nvidia’s Market Risks
Long known for calling out market bubbles, Burry has warned about mounting private debt tied to chip leases and data center expansions. He fears this debt could trigger wider economic consequences, especially as long-term bond yields rise. Nvidia’s recent $250 billion funding deal with OpenAI fueled concerns that the company might be indirectly financing its customers to keep demand alive, raising questions about the sustainability of its growth.
Data center projects, vital to Nvidia's business, have been plagued with delays and cancellations, creating a mismatch between groundbreakings and completions. This inefficiency adds to fears that much of Nvidia’s hardware could become obsolete or stranded in warehouses, undermining the company’s revenue base.
Burry’s move also comes amid a broader cautious mood in tech markets, contrasting with bullish takes on giants like Microsoft climbing 40%. While some investors remain optimistic, Burry’s stance highlights the risks in the semiconductor sector that could ripple through the economy.
This material is for informational purposes only and is not financial advice.
