Michael Burry is increasing his bet against the AI boom, replacing several direct stock shorts with put options as he warns that the market’s artificial intelligence bubble could burst sooner than he previously expected.
In his latest portfolio update, the “Big Short” investor said new research prompted him to move his timeline forward. Burry covered short positions in Nvidia, Palantir, Micron, Nebius and other AI-linked names while shifting much of that exposure into puts.
The move does not signal that Burry is abandoning his bearish view. Instead, he said options provide more capital-efficient leverage over the shorter time horizon he now expects.
Burry Turns AI Shorts Into Puts
Burry’s new positions target some of the biggest winners of the AI investment cycle.
His Micron exposure moved into June puts with strikes near $500, while Nvidia was shifted into September 2027 contracts with strikes in the mid-$100s. He also increased his Palantir put exposure, concentrating positions around September 2027 strikes in the low $100s.
Nebius, Oracle and semiconductor exposure through SOXX were also included in the repositioning.
The shift follows Burry’s earlier bets against Nvidia and Palantir, but the latest trades suggest his conviction about the timing has changed.
Burry wrote that he was “moving timelines up,” arguing that the bubble may burst “sooner than later.”
Nvidia, Palantir and Micron Sit at the Center of the AI Trade
Burry is targeting companies that have benefited heavily from investor enthusiasm around AI infrastructure.
Micron has surged more than 270% this year, while Nvidia remains the dominant supplier of AI accelerators and one of the largest companies in the S&P 500. Palantir has also become one of the market’s most prominent AI-linked stocks.
That concentration means any major reversal could have consequences far beyond individual companies.
AI names now represent an unusually large share of the S&P 500’s biggest holdings, making the broader market increasingly sensitive to changes in AI valuations.
At the same time, the enormous AI spending boom increasingly depends on debt financing, long-term data-center commitments and continued demand for expensive computing infrastructure.
Burry Thinks the AI Bubble Could Break Earlier
Burry’s concern is not that artificial intelligence will disappear.
His argument centers on whether current valuations and infrastructure spending can be sustained long enough to justify investor expectations.
He had previously pointed toward 2028 as a potential period when excess computing capacity could become more obvious. His latest repositioning suggests he now sees the possibility of market stress considerably earlier.
That fits Burry’s broader warning that concentrated positioning and leverage could trigger a much sharper stock-market reversal if sentiment turns.
