News
Michael Burry holds put options on Oracle
Saturday, January 10, 2026 at 12:23 AM
Scion Asset Management, led by Michael Burry, has disclosed holding put options on Oracle Corporation.
Context
Michael Burry’s Scion Asset Management has initiated a bearish position in Oracle through put options, targeting the company’s role in the ongoing artificial intelligence infrastructure build-out. Burry’s thesis alleges that Oracle is inflating profits by understating the depreciation of AI chips, which he claims lose value far faster than reported. He estimates this accounting practice could cause Oracle to overstate its earnings by nearly 27% by 2028, eventually leading to significant asset write-downs as the hardware matures.
Despite Oracle reporting a record $523 billion backlog and a 14% revenue increase, Burry is focusing on the company's financial liquidity and mounting costs. Oracle recently raised its fiscal 2026 capital expenditure guidance to $50 billion, contributing to a negative free cash flow of $10 billion in the last quarter. With a debt-to-equity ratio reaching 3.28, Burry’s bet reflects growing skepticism regarding the long-term profitability of the current AI spending cycle.
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