Michael Burry Bets $10 Million Against AI Giants by 2027

Michael Burry, the legendary hedge fund manager immortalized in “The Big Short,” has made controversial predictions about the artificial intelligence market by betting approximately $10 million that major AI stocks will plummet. According to The Wall Street Journal, Burry revealed his bearish positions through his new Substack newsletter, targeting two prominent companies in the tech sector.

The Specific Predictions

Burry’s wager against Nvidia requires the stock to drop 37 percent to $110 by 2027, compared to its current price around $190. Similarly, he predicts Palantir will fall from roughly $200 to $50 during the same timeframe. These positions represent significant bets against two of the most valuable AI-focused companies in the market.

Comparing AI to Dot-Com Bubble

In his newsletter, Burry argues that the AI market has fundamentally “detached from reality,” drawing parallels to the infamous dot-com bubble. He goes further by comparing Nvidia to Enron, alleging the company uses accounting tactics to exaggerate chip life expectancy and inflate earnings. This aggressive comparison underscores his belief that current AI valuations are unsustainable.

While Burry’s track record includes a remarkable $700 million profit from betting against the housing market before the 2008 financial crisis, his predictions over the past 15 years have been mixed. Many investors remain skeptical of his current AI warnings, highlighting the uncertainty surrounding his latest forecasts. Nevertheless, his substantial $10 million bet signals serious conviction in his bearish outlook for the sector.