“Big Short” investor Michael Burry is doubling down on his bet against the AI infrastructure boom, adding to short positions in Oracle Corp. (NYSE:ORCL), Micron Technology Inc. (NASDAQ:MU) and Nebius Group (NASDAQ:NBIS) as he predicts an AI compute glut in 2028.
He disclosed on Substack that he added to Nebius around $247, Micron around $924 and Oracle around $152, and boosted March 2027 puts on the iShares Semiconductor ETF (NASDAQ:SOXX).
Burry first shorted Nebius at $211.77 earlier this month, calling his bearish bets “a bit like shooting fish in a barrel.”
Burry Says Debt Is Putting the AI Boom on a Clock
He argues circular financing allows capital injected into the AI ecosystem to flow back to participants as revenue, while debt makes up a growing share of that capital, which he says "puts the bubble on a clock."
The setup reminds him of 2000, when tech firms grew by selling to each other.
Burry calls 2028 his base case for when “compute becomes too much.” He says history suggests markets catch on well before such turns.
Why Burry Thinks Nebius Shows AI Is Near a Peak
Nebius reported 454% revenue growth this week as customers scramble for scarce AI compute. Its landmark contracts generate $20 million to $25 million per megawatt, while Nebius says short-term deals could command $40 million to $50 million.
To Burry, it looks like what happens near the top of a boom: customers are paying extraordinary prices for scarce capacity today, while longer-term compute is priced far lower. He argues that the steep pricing curve suggests the GPU, the customer or both are losing value rapidly.
Oracle and Micron Extend the Bet Across AI Infrastructure
Oracle is spending heavily on AI infrastructure even as free cash flow has turned negative. S&P Global Ratings cut the company to BBB-, one notch above junk, in July, while its future data center lease commitments have climbed to roughly $260 billion, Reuters reported.
Oracle also expects up to $95 billion in fiscal 2027 capital spending. Burry’s concern is that those commitments could become much harder to justify if AI compute becomes oversupplied and returns fall.
Burry is also directly short Micron, betting against one of the biggest beneficiaries of the AI memory boom. He added to the position around $924 after first shorting the stock near $1,052 in July. His SOXX puts extend the bearish bet across the broader chip sector.
Prediction Market Traders Don’t Expect an Immediate Bust
Polymarket traders remain skeptical that a severe AI downturn will arrive this year, giving a 15% chance one arrives before the end of 2026.
For Burry, the question is not whether AI demand is strong today, but whether the industry is building more capacity than it can profitably use once the current shortage eases.
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