Burry explains why Oracle is on his short list

Mike Burry is going after Oracle now. The man known for his infamous short on the housing market in 2008 says he’s holding put options on the tech giant.

He made the reveal late Friday in a Substack post. A put is a bet that pays when the stock price falls. And according to Burry, he’s been building this position over the past six months.

He’s not just holding puts. He also shorted Oracle stock directly. This isn’t his first punch at an AI-related company either.

In November, Burry said he was betting against Nvidia and Palantir, two of the market’s most hyped AI names. Oracle’s recent obsession with cloud infrastructure, and the debt it’s taken on to build it, is apparently not sitting right with him.

Burry explains why Oracle is on his short list

“I do not like how it is positioned or the investments it is making. It did not need to do what it is doing, and I do not know why it is doing this. Maybe ego,” Burry wrote when a reader asked why he’d shorted Nvidia and not Oracle. It turns out he was doing both. He didn’t exactly say how big the bet was, but the message was he thinks Oracle’s AI push is reckless.

Oracle has gone all-in on cloud services, trying to keep up with Microsoft and Amazon. That means building out data centers stuffed with Nvidia chips, and that’s costing a fortune. Oracle has borrowed like crazy. The company now sits on $95 billion in debt, making it the biggest corporate borrower outside the financial sector in Bloomberg’s high-grade index.

Investors loved the idea at first. Oracle’s stock jumped 36% in a day back in September after it gave a bullish forecast tied to its cloud and AI plans.

But reality didn’t play along. Costs piled up. Doubts spread about its cloud contracts. And the debt kept climbing. The stock gave up all those gains and ended the year down 40% from that September peak.

Oracle reshuffles leadership as AI costs grow

The company’s boardroom is also changing. Two long-time directors (George Conrades and Naomi Seligman) are retiring. Conrades ran Akamai in the past. Seligman is a senior partner at tech research firm Ostriker von Simson. Oracle said there was no dispute involved. The board now has 12 members.

Meanwhile, Safra Catz is out as CEO. Oracle replaced her with Clay Magouyrk and Mike Sicilia, two execs tasked with speeding up data center rollouts for clients like OpenAI and xAI. The plan is to keep buying Nvidia’s chips and run large-scale AI models for outside firms.

While Burry is avoiding shorts on Meta, Alphabet, and Microsoft, he says those giants aren’t pure AI bets. “If I short Meta, I’m also shorting its social media and advertising dominance,” he wrote. “The big ones are not pure shorts on AI.”

He said they’ll cut spending eventually and stay dominant, even if they overbuilt. “These three will not go away,” he added.

But he’d happily short OpenAI at a $500 billion valuation. For him, Nvidia is still the clearest way to bet against the AI bubble. “Nvidia also is the most loved, and least doubted,” Burry wrote. “So shorting it is cheap, and its puts are cheaper than some of the other big shorts out there that are more doubted.”

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