Michael Burry sends another Nvidia stock verdict to investors

Michael Burry has spent much of 2026 betting against Nvidia. He also bought calls on the stock. That's a move that would look like a reversal from almost anyone else on Wall Street.

The move looks contradictory on the surface, but Burry laid out exactly why he made it. The reasoning says as much about his broader AI skepticism as it does about Nvidia specifically. It also arrived at an unusually consequential moment for the stock.

Michael Burry buys Nvidia calls while betting against the stock

Burry bought December Nvidia calls with strikes set in the mid-to-high $200s ahead of the chipmaker's earnings, while simultaneously adding to his short position in the stock. He described the calls as a hedge rather than a bullish trade, Benzinga reported.

"I am not playing for gains here," Burry wrote in the Substack post, adding that he would not have made the trade at all without such a large existing short and put position to offset. The call options account for roughly 3.5% to 4% of his portfolio.

Nvidia was not the only name in the trade. Burry also added to his short positions in Oracle, Palantir and Nebius, pushing his total short stock position above 21% of his portfolio, excluding puts. He separately added to long positions in Birkenstock and Freddie Mac, according to Cryptonomist.

Nvidia had closed at $217.56 the prior week, down slightly on the day but still up roughly 17% year to date heading into the report. The Substack post carried a pointed title, "Nvidia, Friends, and the Rebel Alliance." Burry has acknowledged that his past attempts at hedging around Nvidia earnings with short-dated options have produced inconsistent results.

Nvidia earnings beat and August 27 stock reaction

The timing of Burry's move lined up with one of the most closely watched earnings reports of the year. Nvidia posted adjusted earnings of $2.22 per share for its fiscal second quarter, beating the $2.09 consensus estimate, while revenue climbed 106% year over year to $96.2 billion, well above the $92.27 billion Wall Street had expected, CNBC reported.

Nvidia also issued an unusually bold outlook. The company guided to more than $108 billion in revenue for its current quarter, plus or minus 2%. More unusually, CFO Colette Kress said Nvidia expects revenue growth of 70% for fiscal 2028, nearly twice what analysts had expected, according to CNBC. Supply commitments more than doubled from $119 billion last quarter to $279 billion, primarily related to memory procurement.