Burry's AI Bets Get Crushed as Nvidia, Palantir, Caterpillar Defy the Short Seller
Michael Burry, a well-known investor and author of the book 'The Big Short', has been bearish on AI-driven stocks for some time now. He has been shorting companies like Nvidia (NVDA), Palantir Technologies (PLTR), and Caterpillar (CAT) since late 2025. Despite acknowledging their strong performance, Burry warns that today's gold rush could create tomorrow's 'ghost towns'. He compares the current AI boom to the late-1990s telecom buildout, where excessive investment led to underused capacity.
Nvidia, Palantir, and Caterpillar have defied Burry's bearish bets this week, with PLTR surging 29%, NVDA climbing 15%, and CAT gaining 11%. These gains outpaced the iShares Semiconductor ETF (SOXX), which advanced 14%, as well as the broader market: the Invesco QQQ Trust (QQQ) rose 8.4%, the SPDR S&P 500 ETF Trust (SPY) gained 5.5%, and the SPDR Dow Jones Industrial Average ETF Trust (DIA) added 5.3%. Burry's concerns about suppliers financing customers that buy their products have been echoed by recent deals, with Nvidia reportedly considering guaranteeing up to $250 billion for OpenAI's lease of a proposed $500 billion Ohio data center.
Burry has been critical of Palantir's valuation, calling it 'wildly overvalued' and placing its fundamental value well below $50 in April. However, the company's recent earnings report showed revenue jumping 93% to $1.94 billion, with U.S. commercial sales up 149% and U.S. government revenue rising 90%. Palantir maintains that its platform delivers measurable results, but Burry remains skeptical.