Michael Burry expands short bets in chip trade, adding Micron to wagers against NVDA and Applied Materials

Michael Burry, the hedge-fund investor made widely known by the book and film “The Big Short,” disclosed another bearish trade tied to the artificial-intelligence chip boom, this time targeting Micron Technology. In a July 2 post on his Substack that circulated in market coverage on July 3, Burry said he established a short position in Micron and framed the move as part of a broader view that the chip rally may be due for a sharp correction.

The disclosure added Micron Technology, ticker MU, to a list of earlier short positions Burry reported the prior day. According to the market reports, the earlier package included NVIDIA, ticker NVDA, and Applied Materials, ticker AMAT, along with a short tied to the iShares Semiconductor ETF, ticker SOXX. Burry’s central claim across the campaign was that AI-linked chip stocks may be vulnerable to a potential 30% drop, drawing on a combination of historical cycle patterns and what he described as stretched trading.

For Micron specifically, the coverage said Burry characterized options on the stock as “seemed expensive,” so he shorted shares directly instead. The same reports said his disclosed entry level for the Micron short was $1,051.87 per share, and that he would consider adding puts if volatility eased. While the reports describe his reasoning, they do not show details about the size of the position or the exact hedging mechanics beyond the entry and the preference for direct short exposure at the time of disclosure.

Burry tied his Micron argument to what he described as extreme technical conditions following a powerful year-to-date run. The reports stated that Micron shares were up 242% year to date through July 2, with a market capitalization reported near $1.17 trillion. They also said Burry argued the stock was more extended above its 200-day moving average than at any point since 1984, and that the degree of extension was “not even” at the dot-com peak.

Beyond chart indicates, Burry’s comments in the coverage focused on how he views Micron’s underlying business through the memory cycle. He reportedly said Micron “defines cyclical like no other,” citing 34 drawdowns of more than 30% over 42 years. The reports also attributed to him a critique of performance metrics over time, including a median return on invested capital of 4% and median return on equity of 7%, which he called “frankly terrible.” In the same framing, the coverage said he pointed to free cash flow being negative 48% of the time, adding that Micron has historically destroyed capital in a significant share of quarters.

In the market reports, Burry linked the timing of his short to what he described as fear-of-missing-out dynamics around high-bandwidth memory, or HBM, and to expectations that supply could remain constrained through 2026. He suggested that when that optimism is widely priced into the stock, it can create conditions for a pullback if the cycle turns or expectations soften, even if demand remains strong in the near term.

For NVIDIA and Applied Materials, the same earlier disclosures helped position Burry’s bets as more than a single-stock trade. NVIDIA is a key designer of AI accelerators and a bellwether for the broader spending cycle in data centers, while Applied Materials provides chipmaking equipment and process technologies. The iShares Semiconductor ETF short, SOXX, was described in the coverage as adding more direct exposure to the idea of a sector-wide correction, rather than relying entirely on idiosyncratic outcomes for any one company.