Michael Burry says he's still bearish after Nvidia's 10% plunge — but the market may see it as a 'heck of a trade' soon

Michael Burry remains skeptical about Nvidia's future despite the recent 10% drop in the company's stock price. The decline in shares was primarily driven by CEO Jensen Huang's affair scandal, which surfaced earlier this week. Burry expressed shock at the market's swift reaction to the news, stating that although he is bearish on Nvidia, the market might consider it a "heck of a trade" in the near future.

Burry, who gained fame through his investment in The Big Short, cited concerns over excessive AI spending and possible stricter regulations as key factors contributing to the stock's decline. His predictions have become increasingly pessimistic, with the value investor warning of looming government crackdowns and investigations into Nvidia's business practices following the scandal.

In a recent Substack post, Burry confessed that he was initially shocked by the market's negative response to the company. Despite his bearish stance, he admitted that he could imagine the market seeing Nvidia as a favorable investment opportunity soon. He also criticized the tech giant's aggressive investments in other AI players, describing their behavior as "mafia-like," and warned that the US government might crack down on the export of Nvidia chips to China.

Burry's skepticism towards Nvidia has not dissipated, and he has continued to warn against the AI boom's potential downfall. His criticism of aggressive accounting, hidden debts, and unsustainable investments has made him a prominent figure in the field of value investing.