Michael Burry Puts a Big Short on Nvidia as the Chip Giant Retools Its Sales Playbook
Published on 07/03/2026 at 09:43 | Redaktion boerse-global.de
Michael Burry, the investor immortalized for betting against the US housing market in 2008, has once again stepped into the path of a freight train — this time aimed directly at Nvidia. His fund, Scion Asset Management, disclosed a short position against the chipmaker at a share price of around $198, adding to existing bets against Tesla and the semiconductor index SOXX. The move, made public in early July, comes as Nvidia’s shares have already been under pressure, losing 7.63% over the past 30 days and sitting 15.76% below their 52-week peak of €202.50 reached in May.
Burry has drawn parallels to the dot-com bubble, warning that the artificial-intelligence infrastructure buildout is creating overcapacity. He is not alone in his caution: the broader market has shown signs of rotation, with the Dow Jones hitting fresh highs above 52,000 while technology stocks sold off. June’s US jobs report, which added only 57,000 positions against an expected 110,000, helped fuel the shift into defensive sectors such as healthcare, utilities, and consumer goods.
The Technical Picture Wavers While Valuation Compresses
Down at €170.58, Nvidia’s stock now trades 5.65% below its 50-day moving average of €181.35. The 14-day relative strength index stands at 42.4 — a neutral reading that signals no extreme oversold or overbought conditions but confirms waning momentum. Yet the valuation picture has become notably cheaper. The stock carries a forward price-to-earnings multiple of roughly 20 to 22 times earnings, well below its own five-year average of 53 and even the sector median of 34. With a PEG ratio of 0.49 against expected earnings growth of 81%, some analysts argue the shares already show value characteristics despite the bubble warnings.
The primary source of the near-term anxiety lies in the tension between Nvidia’s still-commanding market position and the growing list of threats. On a twelve-month basis, the stock is up 26.16%, and since the start of the year it has gained 6.21%. The average analyst price target of €263.63 implies a 54.1% upside from current levels, suggesting that the professional consensus sees the recent slide as a pause rather than a reversal.
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Customers Begin to Build Their Own Alternatives
The most visible competitive pressure is coming from Nvidia’s own largest clients. Google, Amazon, and Microsoft are all developing custom chips for their data centers, while OpenAI has partnered with Broadcom on its own silicon. Anthropic, another AI lab, is working with Samsung Foundry on 2-nanometer technology designed to reduce reliance on Nvidia’s accelerators, which still command more than 70% of the market. Even Meta Platforms is exploring the sale or lease of excess data-center capacity, a move that could dampen demand for new GPU clusters.
The China front remains a geopolitical wild card. US export controls have severely limited sales of advanced AI chips to the country, and local rival Huawei is filling the gap. Analysts expect a permanent shift in the regional balance, further complicating Nvidia’s growth narrative.
Nvidia Fights Back With Financing, Buybacks, and a New Sales Chief
Rather than wait for the market to decide the outcome, Nvidia is actively reshaping its business model. The company has introduced a revenue-sharing structure for cloud providers, effectively becoming a co-investor in AI infrastructure. In a recent example, Nvidia participated in an $800 million funding round for Together AI, a GPU-cloud startup focused on open-source models that was valued at $8.3 billion. The goal is to unlock more computing capacity for startups and research institutions while deepening the moat around its CUDA software platform, which millions of developers already rely on.
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On the capital-allocation front, the board has authorized a colossal $80 billion share-buyback program, signaling confidence in long-term cash generation. This is paired with an upcoming quarterly dividend of $0.25 per share, payable in June. At the same time, Nvidia is shaking up its sales leadership: Nicholas Parker, a 26-year Microsoft veteran, will take over as Executive Vice President of Worldwide Field Operations on August 24, replacing the retiring Jay Puri.
Looking ahead, analysts expect the company to report second-quarter revenue of $91.73 billion — a 96% increase year over year. Whether that pace can satisfy both the bears and the bulls will determine if Burry’s latest bet proves as prescient as his last one.
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