Alright, let's talk about Michael Burry and his never-ending war against Nvidia. The guy who called the housing crisis is now screaming about an AI bubble, and Nvidia's his prime target. Is he seeing something everyone else is missing, or has he finally lost it?
Nvidia's latest earnings were, let's just say, impressive. Record revenue, bullish forecasts... the stock jumped 5%. They're practically swimming in cash. CEO Jensen Huang is out there saying there's no AI bubble, just a whole lot of demand. And CFO Colette Kress is bragging about how their old chips are still being used, thanks to their CUDA software. Six-year-old GPUs still running at full tilt? That's either amazing engineering or some serious accounting trickery...
Burry, of course, wasn't buying it. He hopped on X (still can't call it that with a straight face) and started firing shots. His main beef? Nvidia's customers are stretching the depreciation of their equipment to make earnings look better. Just because a chip is still running doesn't mean it's profitable, he argues. He used the analogy of airlines keeping old planes in service during the holidays – they're barely making money off them, and they're definitely not worth much.
He's got a point, right? I mean, energy costs alone must be insane for companies still running ancient hardware. It's like driving a gas-guzzling Hummer when you could be in a Prius. Sure, it works, but at what cost?
Then he went after the "give-and-take deals" between Nvidia, OpenAI, Microsoft, and Oracle, claiming the "true end demand is ridiculously small" and that "almost all customers are funded by their dealers."
Oof.
That's a big accusation. Is the whole AI thing just a house of cards built on hype and funny money? Are these companies just selling to each other in a circle, inflating the numbers?
And then there's the stock buyback thing. $113 billion in buybacks since 2018, yet they have more shares outstanding? Burry says the cost of stock-based compensation diluted owner's earnings by 50%. That's... not great.
It's like a magician pulling rabbits out of a hat while simultaneously pickpocketing the audience. Are they creating value or just shuffling money around?
Burry's final question: "One more. OpenAI is the linchpin here. Can anyone name their auditor?"
Why does that feel like the mic drop moment before a nuclear explosion?
Look, I get it. Burry's a contrarian. He made a fortune betting against the grain. But is he right this time? Is Nvidia a ticking time bomb? Or is he just being stubborn? Maybe he missed the boat and refuses to admit it.
Let's be real, though, the guy's got a track record. And some of the things he's pointing out do sound kinda fishy. This whole AI gold rush feels a little too good to be true, offcourse.
But here's the thing: Nvidia's not some fly-by-night startup. They're the king of the hill when it comes to AI chips. They've got a massive head start, a ton of cash, and a whole lot of smart people working for them. Can Burry really take them down?
Maybe I'm just being cynical. Maybe I'm missing the big picture. Maybe AI really is the future, and Nvidia's leading the charge. Then again, maybe I should short the whole damn market...
Nvidia's CEO, Jensen Huang, directly addressed the bubble concerns, which is pretty ballsy. He's basically saying, "Nah, we're good. Everything's fine." And CFO Kress is backing him up with numbers and projections. They're talking about a $0.5 trillion market for their new Blackwell and Rubin architectures over the next few years, and trillions more in AI infrastructure spending by 2030. Nvidia stock soars after Q3 earnings, forecasts top estimates with sales for AI chips 'off the charts'
That's a lot of zeroes.
But is it realistic? Are they just throwing numbers at the wall and hoping they stick? Or do they actually have a clear view of the future?
The other point I will make is that Peter Thiel's hedge fund recently dumped it's entire stake in the company. That's never a good sign.
This whole thing reminds me of the time I tried to build my own computer. Spent weeks researching parts, watching YouTube videos, and carefully assembling everything. Thought I was a genius. Then I turned it on, and... nothing. Turns out I forgot to plug in the power supply.
Yeah, that's pretty much how I feel about the stock market sometimes. Like I'm missing something obvious, and everyone else is laughing at me.
Honestly, I don't know. Maybe. But I wouldn't bet against him just yet. This whole thing stinks of dot-com 2.0.
McKinsey: What They Do and the AI Report
2025-11-21
