Nvidia Stock Falls. ‘Big Short’ Investor Michael Burry Is Betting Against AI—Again

Nvidia chips are the favored choice for training artificial-intelligence models. (Akio Kon/Bloomberg)

Key Points

• Nvidia shares decreased by 2.4% to $201.96 in early trading, aligning with a 1.1% drop in the broader S&P 500.
• Michael Burry’s Scion Asset Management acquired put options on Nvidia stock with a notional value of $187 million.
• Scion’s portfolio includes a $912 million put option against Palantir, with both positions comprising 80% of the portfolio.

Nvidia was slipping early on Tuesday. Famed Big Short investor Michael Burry looks to be skeptical about the chip maker’s trajectory.

Nvidia shares were down 2% at $202.83 in premarket trading. The move was broadly in line with the wider market, with futures tied to the S&P 500 dropping 1.1%.

Burry’s Scion Asset Management bought put options with a notional value of $187 million on Nvidia stock, a regulatory filing for the quarter ending Sept. 30 shows. A put is a bearish option that gives the holder the right to sell the security at a set price over a specified period.

Scion reported a much larger put option against AI software company Palantir, with a notional value of $912 million. Together, the two positions represent 80% of Scion’s portfolio.

Burry hasn’t publicly commented on his latest moves and Scion didn’t immediately respond to a request for comment. Managers have 45 days to file the reports from the end of the quarter so it isn’t clear if Scion still holds the position or how it has performed. The amount paid for the put option is likely to be much smaller than the notional value.

This isn’t the first time Burry has taken positions suggesting skepticism over the AI boom. Back in 2023 his asset-management company bought put options against the iShares Semiconductor ETF , which counts Nvidia among its major constituents and has surged since then.

Burry obtained mainstream fame after he was portrayed by Christian Bale in The Big Short movie, following his bet against the housing market ahead of the 2007 subprime mortgage collapse.

Among other chip makers, Advanced Micro Devices wasdown 2.3% and Broadcom was falling 1.3% in premarket trading.

Write to Adam Clark at adam.clark@barrons.com