Michael Burry doubles down on stock market, AI message for 2026 Hillary Remy May 24, 2026 6 min read Nvidia just reported $81.6 billion in quarterly revenue, up 85% year over year. Its data center business alone generated $75.2 billion, up 92%. The numbers are extraordinary by any measure.
Michael Burry's argument is that they may also be the most dangerous kind of numbers there are. Burry argues against AI infrastructure trade In a May 2026 Substack post titled "The Heretic's Guide to AI's Stars Part III: Tracepalooza and the Bezzle," Burry laid out his most specific argument yet against the AI infrastructure trade. The post has been read by more than 200,000 subscribers, and the reaction from Wall Street was significant enough that Nvidia (NVDA) took the unusual step of sending a memo to sell-side analysts pushing back on his arguments on stock-based compensation and depreciation, according to CNBC.
Burry responded directly. I am not claiming Nvidia is Enron. It is clearly Cisco," he wrote, CNBC confirmed.
More Wall Street: JPMorgan resets S&P 500 price target for the rest of 2026 Vanguard challenges the S&P 500 as a one-stop strategy Goldman Sachs resets Broadcom stock forecast "NVIDIA is benefitting from strong demand, but is selling into a concentrated set of buyers whose own demand is being distorted by a training and benchmarking phase that will not last," Burry explained. "That distorted demand is working like a bullwhip into NVIDIA's own supply chain through custom supply commitments as well as downstream into data-center financing. Looming over it all is the bezzle, which once seen, cannot be unseen, and once revealed, does not exist." The 3 mechanisms Burry says make Nvidia specifically dangerous Burry is not making a general market argument.
He is making a specific structural argument about Nvidia's revenue concentration, supply chain obligations, and the nature of demand driving its numbers, according to 24/7 Wall St. The first mechanism is buyer concentration. Hyperscalers, primarily Microsoft, Google, Amazon, and Meta, account for approximately 50% of Nvidia's data center revenue.
That concentration means a relatively small change in any one customer's capital expenditure plans can produce an outsized revenue effect. Burry has calculated that if Microsoft alone cuts its Nvidia chip spending by 20%, the revenue impact on Nvidia is approximately 4.2%, he noted on Substack. The second mechanism is the bullwhip effect.
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