Oracle(US:ORCL) Hua Er Jie Jian Wen·2026-01-10 05:00Core Viewpoint - Michael Burry, a well-known investor and the inspiration behind the movie "The Big Short," has disclosed his short position on Oracle through a Substack post, reinforcing his belief that the current AI market is overvalued and in a bubble [1]. Group 1: Short Position and Criticism of Oracle - Burry has directly shorted Oracle in the past six months, criticizing the company's strategic positioning and aggressive investments in AI, suggesting that Oracle is unnecessarily expanding its capital expenditures to compete with cloud giants like Amazon and Microsoft [1]. - He expressed skepticism about Oracle's current investments, questioning their necessity and implying they may be driven by ego rather than sound business strategy [1]. Group 2: Comparison with Other Tech Giants - Burry's rationale for shorting Oracle instead of other tech giants like Microsoft, Alphabet, and Meta is based on the latter's strong core business moats, which provide them with a safety net even if their AI investments fail [2][3]. - In contrast, Oracle's stock price is heavily reliant on a single narrative of surging AI cloud service demand, making it more vulnerable to market fluctuations [3]. Group 3: Financial Concerns and Debt Issues - Oracle's aggressive capital expenditures and deteriorating balance sheet are key factors in Burry's bearish outlook, as the company has incurred approximately $95 billion in outstanding debt, making it one of the largest corporate bond issuers outside the financial sector [6]. - The shift from a "light asset" to a "heavy asset" model has led to significant debt burdens, raising concerns about Oracle's ability to sustain its growth strategy, especially in a high-interest-rate environment [6]. Group 4: Broader Skepticism Towards AI Industry - Burry's short position on Oracle reflects a broader skepticism towards the AI industry, as he questions the sustainability of the current AI hype and pricing models [7]. - He has indicated a willingness to short other AI-related companies, including OpenAI, if their valuations reach unsustainable levels, highlighting his overall bearish sentiment towards the AI sector [7]. Group 5: Market Reaction - Oracle's stock has experienced significant volatility, with a 36% surge last September due to optimistic forecasts for cloud services, followed by a 40% decline from its peak as investor concerns about rising capital expenditures and debt levels grew [6]. - Burry's entry into the short position has intensified market worries regarding Oracle's high-leverage strategy and its long-term viability [6]. Group 6: Oracle's Response - As of the time of reporting, Oracle has not responded to Burry's comments or his short-selling actions [8].