Nvidia(US:NVDA) Hua Er Jie Jian Wen·2025-11-27 01:08Core Viewpoint - The ongoing conflict between Michael Burry, known as the "Big Short," and NVIDIA is intensifying, with Burry criticizing NVIDIA's internal memo as disappointing and filled with straw man arguments [1][3]. Group 1: Burry's Critique - Burry claims that NVIDIA's memo misrepresents his criticisms, addressing points he never made, particularly regarding the company's depreciation policies [5]. - He emphasizes that he has never questioned NVIDIA's fixed asset depreciation policy, stating that the company is primarily a chip designer with minimal capital expenditure [5]. - Burry warns that the rapid technological advancement in AI chips could lead to significant asset write-down risks for companies extending depreciation periods [8]. Group 2: Market Reaction and Positioning - Following Burry's criticisms, NVIDIA's stock has declined approximately 14% from its peak on November 3, indicating a shift in investor sentiment towards AI-related companies [2][11]. - Burry continues to hold put options against NVIDIA and Palantir, signaling his bearish outlook on these AI companies [3][10]. - The market has shown increased scrutiny of AI companies, with Palantir's stock also dropping 20% from recent highs, despite significant year-to-date gains [11]. Group 3: NVIDIA's Defense - In response to the criticisms, NVIDIA distributed a seven-page memo to Wall Street analysts, aiming to refute allegations of accounting fraud and circular financing [12]. - The company asserts that its depreciation practices align with industry standards, with customers typically depreciating GPUs over 4-6 years [14]. - NVIDIA emphasizes its leading position in the AI market, claiming to be the only company capable of running all AI models across various computing scenarios [12].