“The ‘Big Short’ investor Michael Burry Wednesday hinted that his bearish bets against artificial intelligence-linked stocks were part of a broader thesis after revealing short positions in Elon Musk-led Tesla Inc (NASDAQ:TSLA), chip maker Nvidia Corp (NASDAQ:NVDA) and other companies earlier this week.
Burry’s Bearish Bets
“There is so much more to this,” Burry said in a post on X.
Burry made the remark in response to a Wall Street Journal article highlighting his latest bearish positions against Tesla, Nvidia, Applied Materials Inc (NASDAQ:AMAT), Caterpillar Inc (NYSE:CAT) and the iShares Semiconductor ETF (NASDAQ:SOXX).
Burry did not elaborate on his post on X.
In a Substack post published July 1, Burry disclosed the bearish positions, citing the Philadelphia Semiconductor Index’s historically high extension above its 200-day moving average and calling the latest AI-driven spending surge “the beginning of the end.”
AI Valuation Debate Grows
The AI spending boom has become one of Wall Street’s biggest debates, with hyperscalers committing hundreds of billions of dollars to infrastructure, while investors question when those investments will generate returns.
Morgan Stanley expects hyperscalers to spend about $805 billion on capital expenditures in 2026, while Goldman Sachs estimates AI-related spending was running at an annualized $650 billion and could exceed $800 billion by the end of the year.
On Tuesday, Apollo Global Management Chief Economist Torsten Sløk warned that U.S. stocks could face a sharp repricing if AI investments take longer than expected to generate earnings growth, adding that the markets may be getting ahead of the underlying cash-flow reality.
Not Bearish On All AI Stocks
Burry, who famously predicted the 2008 housing market collapse, has not been bearish on all companies tied to AI.
In his blog from May, he named Adobe Inc (NASDAQ:ADBE) Intuit Inc (NASDAQ:INTU), Autodesk Inc (NASDAQ:ADSK) among software firms he viewed as AI beneficiaries, while warning that DocuSign Inc (NASDAQ:DOCU) faced greater disruption risks from AI-powered workflows and growing competition.
Price Action: The iShares Semiconductor ETF closed 6.41% lower on Wednesday at $599.70, and fell further 6.36% in extended trading.
Benzinga edge rankings indicate SOXX has a Momentum score in the 96th percentile and a positive price trend across the short, medium and long term.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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