Mike Burry Says He’s Shorting Oracle with Puts and Stock Shorts
Mike Burry, famed for his 2008 housing market short, disclosed in a Substack post that he has built put-option positions on Oracle and has also shorted the stock over the past six months. Burry criticises Oracle’s aggressive cloud and AI expansion, arguing the company’s large data‑centre buildout and Nvidia chip purchases have driven debt to roughly $95 billion — the largest nonfinancial corporate borrower in Bloomberg’s high‑grade index. Oracle’s shares surged 36% in a single day in September on AI optimism but finished the year about 40% below that peak as costs, contract doubts and rising debt weighed on returns. Oracle recently replaced CEO Safra Catz with two executives to accelerate data‑centre rollouts and continues to prioritise Nvidia GPUs to run large AI models for customers such as OpenAI and xAI. Burry has also publicly targeted Nvidia and Palantir previously, calling Nvidia a preferred way to bet against an AI bubble. He says he avoids shorting Meta, Alphabet and Microsoft because their businesses are not pure AI plays. Key stats/points: put options + direct shorts on Oracle; ~6‑month position build; Oracle total debt ≈ $95 billion; September stock spike +36%, then ~40% off peak by year‑end. Primary keywords: Mike Burry, Oracle, put options, short, AI, Nvidia, debt, cloud.
Bearish
This news is categorised as bearish for market sentiment, especially in AI and cloud infrastructure-related stocks. A high-profile investor publicly declaring put positions and direct shorts on Oracle — a prominent AI cloud play — can amplify downside pressure by signaling perceived overvaluation and balance‑sheet risk (notably ~$95bn debt). Similar high‑visibility short calls (e.g., past targeted warnings on overhyped sectors) have prompted sell‑side re‑ratings and increased volatility in the targeted names and correlated suppliers (like Nvidia). Short term: expect heightened volatility in Oracle shares, potential downward repricing, and increased option activity (higher put volumes and implied volatility). Related stocks (cloud peers, AI infra suppliers and contractors) could see spillover selling as traders re‑assess capex and margin risk. Longer term: if Oracle’s debt servicing and cloud contract economics come under sustained scrutiny, valuations could compress and credit spreads widen, pressuring the sector; conversely, if Oracle demonstrates clear revenue traction and improved margins from AI services, the bearish pressure may fade. Traders should watch earnings, guidance, data‑centre capex updates, Nvidia GPU demand signals, and option skew to gauge market conviction and timing for trades.