Michael Burry Bets Against Tesla (TSLA), Nvidia (NVDA) and Semiconductor Giants in AI Bubble Warning

Key Takeaways

Table of Contents

Michael Burry disclosed new bearish bets against Tesla, Nvidia, Caterpillar, Applied Materials, and a semiconductor ETF
Caterpillar was shorted at $1,060.98 following an 86% rally during the first six months of 2026
The Philadelphia Semiconductor Index currently trades 65% above its 200-day moving average, echoing conditions from the 2000 tech bubble
Burry suggested recent Korean technology investment announcements signal “the beginning of the end” for AI momentum
The investor maintains a short position in Palantir and has questioned Nvidia’s financial structuring practices

The investor who became renowned for profiting from the 2008 subprime mortgage crisis has unveiled new bearish positions against several leading companies riding the artificial intelligence boom.

Michael Burry announced in a June 30 Substack publication that he has established short positions targeting Caterpillar, Nvidia, Tesla, Applied Materials, and the iShares Semiconductor ETF.

NVIDIA Corporation, NVDA

Burry confirmed entering a short position on Caterpillar at $1,060.98, identifying the industrial machinery manufacturer as among the most overpriced stocks benefiting from AI-related infrastructure investments. The company’s shares had climbed 86% during just the first half of 2026.

“Caterpillar stood out to me significantly,” Burry noted. “This represents my first short position in Caterpillar. Historically, the company has been quite profitable for me when holding long positions.”

He included data visualization demonstrating Caterpillar’s price-to-sales multiple reaching unprecedented levels across at least thirty years, coinciding with the stock achieving all-time peaks.

Chip Sector Concerns Mount

Burry highlighted the Philadelphia Semiconductor Index as another major red flag. According to his analysis, the benchmark currently trades approximately 65% above its 200-day moving average—a deviation magnitude last witnessed during the 2000 internet bubble.

The price-to-sales multiple for the index exceeds 16x even when Nvidia is excluded from calculations. “The SOXX represents concentrated overvaluation in index form,” he stated, suggesting a correction is inevitable and merely “a question of when.”

Burry adjusted his put option strategy on the semiconductor ETF, extending the expiration from January 2027 to March 2027 while simultaneously increasing strike prices from the $320–$350 range to above $400.

He established a short position on Nvidia at $198.09. Burry has historically questioned Nvidia’s financing structures as “fugazi,” detailing how intricate arrangements involving insurance companies, reinsurance organizations, and private lending institutions facilitate AI infrastructure capital deployment.

Tesla and Applied Materials Targeted

Burry revealed shorting Tesla at $416.22, commenting: “Pleased to see it return to this price level.” The exact position size remains undisclosed.

Tesla has declined approximately 4% for the year despite experiencing an 11% weekly surge preceding Burry’s trade announcement. Market participants continue expressing concerns regarding diminishing electric vehicle demand and postponements in robotaxi services and autonomous driving capabilities.

Applied Materials also entered Burry’s short portfolio at $729.40. Notably, Cantor Fitzgerald recently upgraded its price objective on the semiconductor equipment manufacturer to $850 from $650 while maintaining an Overweight recommendation.

Burry confirmed maintaining a bearish position in Palantir, although specific details about this trade remain limited.

He connected the recent AI market enthusiasm partially to technology spending commitments from South Korea. “This represents the beginning of the end in my view,” he commented.

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