Key Takeaways
- The renowned investor behind ‘The Big Short’ has revealed short positions targeting Micron, Nvidia, Tesla, Applied Materials, Caterpillar, and a major semiconductor ETF
- His Micron short was initiated around $1,051.87, with Burry highlighting that the stock’s distance from its 200-day moving average reached historic extremes not seen since 1984
- Burry characterized the artificial intelligence boom as “mass addiction” and quoted the Joker with an ominous “the end is nigh” warning
- Meanwhile, Micron reported a staggering 346% revenue increase year-over-year, reaching $41.5 billion with unprecedented margins and cash generation
- The contrarian position centers on valuation extremes and market timing rather than fundamental business deterioration
The investor famous for profiting from the 2008 financial crisis has now turned his sights on the artificial intelligence and semiconductor boom, taking bearish positions against industry leaders.
Through a sequence of Substack publications beginning June 30, Michael Burry revealed he had established short positions in major companies including Nvidia, Tesla, Applied Materials, Caterpillar, and the iShares Semiconductor ETF. The following day, July 1, he announced an additional short against Micron, initiated at approximately $1,052 per share.
In his post, Burry characterized “the AI narrative” as “nothing more than mass addiction.” He accompanied this assessment with a quote from the Joker in the 1989 Batman movie: “The end is nigh. Dancing with the devil in the pale moon light.”
He shared Bloomberg data visualizations demonstrating that AI-focused semiconductor companies have dramatically outperformed both the cloud infrastructure providers investing in AI and the wider ecosystem of AI-related stocks. Another chart illustrated the Philadelphia Semiconductor Index trading near peak levels within its 15-year valuation band.
The Bull Case Against Micron Explained
Burry’s most pointed critique targeted Micron. He emphasized the stock’s historical volatility, noting it has experienced 34 separate drawdowns exceeding 30% during the previous 42 years, describing it as cyclical “like no other.”
He calculated Micron’s median return on invested capital at merely 4% with a median return on equity of 7%, characterizing both metrics as “frankly terrible.” Additionally, he claimed the company destroys shareholder capital approximately every third quarter.
Regarding Micron’s high-bandwidth memory products, which have benefited from surging AI infrastructure demand, Burry downplayed their significance, calling them “just another in a very long series” of products without sustainable competitive moats.
He attributed the stock’s recent appreciation to “fear of missing out, greater fool theory, and public commitment bias.”
Micron’s Financial Performance Tells Another Story
The actual quarterly results from Micron present a contrasting narrative to Burry’s characterization.
For the quarter concluded in May 2026, the company delivered $41.5 billion in revenue, representing a remarkable 346% increase compared to the prior year. Gross margin expanded dramatically to 84.6%, climbing from 37.7% twelve months earlier.
Net income soared to $28.2 billion, a substantial jump from $1.9 billion in the corresponding quarter of the previous year. Free cash flow generation reached $17.6 billion, marking a dramatic reversal from the $1.7 billion generated a year before.
During the June 24 earnings conference call, Chief Business Officer Sumit Sadana stated that customer demand for the company’s memory products “well above our ability to supply” across virtually all product lines extending through 2028.
Micron shares have delivered approximately 1,000% returns during the past three years and have climbed roughly 260% in 2026 alone.
Currently trading around $976 per share, Micron’s valuation sits at approximately 22 times forward earnings. Company leadership provided guidance anticipating roughly $50 billion in revenue for the upcoming quarter.
Burry’s contrarian wager isn’t predicated on Micron experiencing operational problems. Rather, his thesis suggests the stock price has extended beyond reasonable levels too rapidly, and that the cyclical memory market will inevitably revert to historical patterns.
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