'The Big Short' Michael Burry Accelerates Bet on AI Crash: Bubble May Burst Sooner Than Expected

BlockBeats news, September 29 — According to CNBC, Michael Burry, the real-life figure behind "The Big Short," is moving up his timeline for an AI market reversal and converting some of his direct short positions in Micron Technology, Nebius, Palantir, and the iShares Semiconductor ETF (SOXX) into put options to gain higher leverage at lower cost.

In his latest investment newsletter, Burry said: "Fundamentally, I am moving up my timeline and therefore want to increase leverage on my short positions. When the timing is clearer, using leverage is also more acceptable. Nothing embodies leverage better than options, and with volatility indicators like the VIX currently extremely low, put options are relatively cheap." He said part of the adjustment was motivated by reducing tax burden, but the main reason was his view that "the AI bubble may burst sooner rather than later." His current major position adjustments include:

· Replacing his Micron Technology short position with put options expiring next June at a strike price in the $500 range;

· Replacing his Nebius short position with put options expiring next June at a strike price in the double-digit range;

· Replacing his SOXX short position with put options expiring in September 2027 at a strike price in the low $400s;

· Rolling over and expanding his existing Palantir short and put option positions, centered on put options expiring in September 2027 at a strike price in the low $100s.

Citing research from Ares Management, he noted that the current AI investment boom depends on companies continuously expanding capital expenditures and on AI revenue that has yet to be fully validated. If AI revenue falls short of expectations supporting related capital spending for even a single quarter, some company boards could reallocate funds to other high-certainty projects, and existing legal agreements also provide room for such adjustments.

Beyond AI commercial returns, Burry also continues to bet against the memory chip cycle. Citing Acer CEO Jason Chen, he said that as China's memory chip capacity continues to increase, the industry cannot sustain a supply shortage over the long term, and the memory market will ultimately return to cyclical fluctuations.

Burry has been consistently bearish on tech stocks this year, saying in May that the current market resembled the final months before the dot-com bubble burst from 1999 to 2000. However, U.S. stocks subsequently continued to hit new highs, with the Nasdaq Composite setting a record last week; Micron and Palantir are currently about 16% and 10% below their all-time highs, respectively.