'Big Short' investor Michael Burry has unveiled fresh bets against Nvidia, Tesla and a major semiconductor ETF, warning that parts of the AI-fuelled stock market boom now resemble extremes last seen during the dot-com era.
In a June 30 post on his Substack, Burry disclosed short positions in Nvidia, Tesla, the iShares Semiconductor ETF (SOXX), Applied Materials and Caterpillar. He argued that investor expectations around the semiconductor cycle may have moved ahead of what companies can realistically deliver.
His positions included Nvidia at $198.09, Tesla at $416.22, SOXX at $642.80, Applied Materials at $729.40 and Caterpillar at $1,060.98. Burry did not disclose the size of the trades.
The investor also extended his bearish SOXX position through March 2027 by rolling existing put options, according to his newsletter.
Burry Flags 'Stretched' Semiconductor Rally
Burry's argument is not that artificial intelligence will fail. Instead, he is questioning whether markets have already priced in years of continued growth and near-perfect execution from companies tied to the AI buildout.
Writing about quarter-end trading activity, Burry said June 30 stood out from previous periods of so-called window dressing, where funds adjust holdings to make portfolios appear stronger.
Performance for selected financial assets ranked by YTD returns | DB
— FinGenAi (@ackmeni) July 1, 2026
_/ 1H was dominated by few fast-moving equity trades,
-> Philly Semiconductor Index: 102%
-> KOSPI: 89%
-> Nikkei: 35% pic.twitter.com/HV8TOvqCKE
'This June 30th is different. Window dressing is not even possible. I'd be fooling myself. But I am trading against some of the trends today,' Burry wrote.
He pointed to the Philadelphia Semiconductor Index and its unusually large gap above its 200-day moving average, saying levels like that had not been seen since the dot-com era.
Historical periods with similar semiconductor market extensions have been followed by sharp declines, including falls of 30 per cent or more. Burry did not directly forecast a 30 per cent drop in AI stocks in his post.
Nvidia At The Centre Of The AI Boom
Nvidia has been a key beneficiary of the AI boom, with investors betting that demand for advanced computing infrastructure will continue expanding.
The company's growth has helped drive a broader semiconductor rally, but Burry's trade reflects a different question: whether future AI demand can justify the valuations already built into the sector.
Timing remains a central risk, especially for investors betting against the rally. AI spending could continue rising even if parts of the market eventually become overvalued.
Why Burry Is Shorting Caterpillar
The most unexpected name in Burry's list is Caterpillar, a company better known for heavy machinery than technology. It is also the first time Burry has disclosed a short position against the company.
Burry said the stock had historically been a successful investment for him. 'I have never shorted Caterpillar. It has always done great for me on the long side,' he wrote.
His concern appears linked to the wider AI infrastructure boom. The expansion of data centres requires construction equipment, power systems and physical infrastructure before AI computing capacity can scale.
That connection has pushed companies outside traditional technology into the centre of the AI investment narrative. Burry's position suggests he believes investors may be extending the AI trade too broadly, assigning technology-style expectations to companies benefiting from the wider infrastructure cycle.
Risks Of Betting Against An AI Darling Trade
Burry's reputation was built on his housing-market short, but his later market calls have produced mixed outcomes. Finding expensive assets is only part of the challenge. Investors also need the catalyst that changes sentiment.
The AI debate now centres on whether current spending and earnings growth can continue at a pace that matches expectations. Burry's latest trades are not a bet that artificial intelligence disappears. They are a wager that markets may have priced in too much certainty around one of the most crowded investment themes in the world.
