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Michael Burry Takes Aim at Oracle With Put Options and Short Position

MarketDash Editorial Team
4 hours ago
The legendary investor behind 'The Big Short' has revealed a bearish bet against Oracle, citing concerns about the company's strategic direction as it piles on debt to compete in cloud computing.

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When Michael Burry speaks, Wall Street tends to listen. The investor who correctly predicted the 2008 housing collapse has now set his sights on Oracle Corporation (ORCL), and he's putting real money behind his pessimism.

Burry revealed in a Substack post last Friday that he's holding put options on Oracle shares and has also been directly shorting the stock over the past six months. For those keeping score at home, this is not a casual observation from the sidelines. This is a full-throated bet that Oracle's stock price is heading down.

So what's bothering Burry about Oracle? The database software giant has been making an aggressive push into cloud computing services, which sounds great until you look at the price tag. Oracle has borrowed heavily to build out data center capacity, leaving the company with approximately $95 billion in outstanding debt. That's not just a big number. It's actually the largest debt load of any corporate issuer outside the financial sector in the Bloomberg high-grade index.

When a reader asked Burry about his decision to bet against Oracle, he didn't mince words. He expressed clear dissatisfaction with the company's strategic positioning and investment decisions, though he kept the specific details of his put options under wraps. The market seems to share some of his concerns as Oracle's stock has already cratered about 40% from its September peak.

Interestingly, Burry also explained why he's not taking similar positions against bigger tech names like Meta Platforms Inc. (META), Alphabet Inc. (GOOGL), and Microsoft Corp. (MSFT). His reasoning is straightforward: these companies have diversified businesses that extend well beyond artificial intelligence. Even if they lose money on overbuilt AI capacity, Burry believes they'll continue dominating their core business lines.

Oracle's situation is different. The company is making a massive bet on cloud infrastructure at a time when competition is fierce and debt levels are eye-watering. Whether Burry's bearish call proves as prescient as his housing market prediction remains to be seen, but it's certainly raised questions about Oracle's financial health and strategic direction.

Back to Stock Market News

Michael Burry Takes Aim at Oracle With Put Options and Short Position

MarketDash Editorial Team
4 hours ago
The legendary investor behind 'The Big Short' has revealed a bearish bet against Oracle, citing concerns about the company's strategic direction as it piles on debt to compete in cloud computing.

Get Alphabet Inc - Class A Alerts

Weekly insights + SMS alerts

When Michael Burry speaks, Wall Street tends to listen. The investor who correctly predicted the 2008 housing collapse has now set his sights on Oracle Corporation (ORCL), and he's putting real money behind his pessimism.

Burry revealed in a Substack post last Friday that he's holding put options on Oracle shares and has also been directly shorting the stock over the past six months. For those keeping score at home, this is not a casual observation from the sidelines. This is a full-throated bet that Oracle's stock price is heading down.

So what's bothering Burry about Oracle? The database software giant has been making an aggressive push into cloud computing services, which sounds great until you look at the price tag. Oracle has borrowed heavily to build out data center capacity, leaving the company with approximately $95 billion in outstanding debt. That's not just a big number. It's actually the largest debt load of any corporate issuer outside the financial sector in the Bloomberg high-grade index.

When a reader asked Burry about his decision to bet against Oracle, he didn't mince words. He expressed clear dissatisfaction with the company's strategic positioning and investment decisions, though he kept the specific details of his put options under wraps. The market seems to share some of his concerns as Oracle's stock has already cratered about 40% from its September peak.

Interestingly, Burry also explained why he's not taking similar positions against bigger tech names like Meta Platforms Inc. (META), Alphabet Inc. (GOOGL), and Microsoft Corp. (MSFT). His reasoning is straightforward: these companies have diversified businesses that extend well beyond artificial intelligence. Even if they lose money on overbuilt AI capacity, Burry believes they'll continue dominating their core business lines.

Oracle's situation is different. The company is making a massive bet on cloud infrastructure at a time when competition is fierce and debt levels are eye-watering. Whether Burry's bearish call proves as prescient as his housing market prediction remains to be seen, but it's certainly raised questions about Oracle's financial health and strategic direction.