Burry Adds AI Shorts While Buying Five Beaten-Down Stocks

Michael Burry has increased his short positions against Nebius Group and Palantir, while also betting against Micron and the iShares Semiconductor ETF. At the same time, he says he has bought full positions in five companies outside the AI sector.

The NASDAQ-100 recently reached fresh all-time highs, but Burry called the Nasdaq “historically overvalued, and historically top heavy” in a Substack post. He expects semiconductor production to catch up with demand and memory chips to enter another down cycle over the next two years.

Acer CEO Jason Chen disputed the idea of a current memory shortage in an interview shared by Burry. Chen said China’s production capacity has been increasing and described contract prices as mixed, with some rising and others falling.

Burry’s five full positions are QXO, Sprouts Farmers Market, Build-A-Bear, Birkenstock and Mercado Libre. He said their share prices have “corrected tremendously” and look attractive. All five have fallen by double digits this year, according to the article; Build-A-Bear is down as much as 57%.

Other investors have also warned about AI valuations. GMO co-founder Jeremy Grantham called them “obviously a bubble,” while Jeffrey Gundlach warned of fallout and losers in the AI race. Gundlach said he wants to be out of AI equities.

Micron’s quarterly earnings are due at the end of September. Wall Street expects 940% year-over-year earnings growth, according to data published by Investor’s Business Daily, and Micron’s guidance may shape the AI outlook.