Signalling renewed scepticism around parts of the artificial intelligence boom, Michael Burry has taken a bearish position against Oracle, despite the firm’s growing role in AI infrastructure and its high-profile partnership with OpenAI.
Burry, widely known for his role in predicting the 2008 financial crisis, disclosed in a recent Substack post that he has been holding put options on Oracle shares and has also directly shorted the stock over the past 6 months. The move follows his earlier bearish bets against Nvidia and Palantir Technologies, revealed in November.
Oracle has been aggressively expanding its cloud computing business, a strategy that has required heavy investment in data centre infrastructure, largely funded through debt. The company currently has about $95 billion in outstanding debt, making it the largest non-financial corporate issuer in the Bloomberg high-grade index.
In September 2025, Oracle signed a $300 billion, 5-year cloud computing agreement with OpenAI, led by Sam Altman. Under the deal, OpenAI will begin purchasing computing power from Oracle starting in 2027. While the agreement was seen as a major win for Oracle in the cloud market, it also introduced execution risks and added pressure on capital spending.
Oracle’s stock has remained volatile since then. Shares surged 36% in a single session in September following an optimistic cloud forecast, but those gains faded as investor focus shifted to rising capital expenditure and growing debt linked to data centre expansion. By the end of 2025, Oracle shares were trading about 40% below their September peak.
Burry has explained that he avoids shorting larger technology companies with diversified businesses beyond AI, such as Meta Platforms, Alphabet, and Microsoft. “If I short Meta, I’m also shorting its social media and advertising dominance. If I short Alphabet, I’m shorting Google Search in all its forms, Android, Waymo, etc. If I short Microsoft, I’m shorting a global office productivity SaaS goliath. The big ones are not pure shorts on AI,” he wrote.
He added that while these firms may face losses from overbuilding capacity, their core businesses remain dominant. “These three will not go away,” Burry said. However, he noted that he would bet against OpenAI if it were valued at $500 billion, reflecting concerns over AI economics. He also described Nvidia as the most attractive short tied to the AI boom, citing its popularity and relatively low cost of shorting.
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