Hedge fund manager Michael Burry has swapped short positions in Micron Technology and Nebius Group for put options, pulling forward his timeline for an AI-trade correction. He now expects a downturn within about a year, citing a report on the debt financing behind AI data-center spending.
Michael Burry has rebuilt his bearish AI-market bets, swapping short positions in Micron and Nebius for put options that expire in June 2027. The move pulls forward a timeline he set earlier in 2026, when he first opened the short bets.
Why Burry got more bearish
Burry laid out the shift in a string of Substack posts in late September 2026 and described himself as "more confident than ever" that an AI bubble downturn will play out within a year, according to Crypto Briefing. He pointed to a report from Ares Management on the debt financing behind AI data-center spending as a key factor behind the shift. Ares has argued that there's a much greater chance of a shift in AI capital spending than current stock prices reflect.
His Micron puts carry a strike price around $500 per share, while his Nebius puts carry double-digit strike prices — positions that suggest he expects declines of more than 50% in both stocks. He also holds puts on the SOXX semiconductor ETF with strikes in the low $400s, a bet against the chip sector broadly rather than one company alone.
Micron and Nebius share the same exposure
Micron's earnings rest on surging demand for data-center memory chips that has outstripped manufacturers' ability to produce them, letting suppliers charge more. Investors currently expect supply to catch up with demand by 2028, but Burry also pointed to increased memory-chip production in China, which could weigh on pricing industrywide sooner than expected.
Nebius carries a similar risk on the other side of the same trade. The company takes on the cost of building data-center structures and charges clients a premium for compute capacity, but that premium could shrink if demand cools, since a GPU server in a Nebius facility offers no differentiation from one inside a hyperscaler's own data center. For a business that runs on leverage and depreciating infrastructure, that is a precarious spot.
Burry opened his original shorts on Nebius, Micron, and Oracle earlier in 2026. He has also named Nvidia, Palantir, and Oracle as other AI-trade stocks he views skeptically.
The clearest risk is timing: both sets of puts expire in June 2027, and an options bet that proves right on direction but wrong on timing simply expires worthless.
Sources: The Motley Fool, Crypto Briefing
Trading involves risk.
Risk Disclaimer
