Oracle (ORCL) Stock: Michael Burry Reveals Put Options and Short Position against Cloud Giant

TLDR

• Michael Burry revealed he owns put options against Oracle and shorted the stock in the last six months
• Oracle stock fell 40% from its September peak after hitting record highs on AI-driven cloud optimism
• The company carries $95 billion in debt, making it the largest corporate issuer outside financial firms
• Burry criticized Oracle’s expensive data center expansion strategy, calling it unnecessary and possibly ego-driven
• He prefers shorting Oracle over larger tech firms because Oracle’s AI push isn’t balanced by dominant legacy businesses

Michael Burry just dropped a bomb on Oracle. The investor famous for predicting the 2008 housing crisis disclosed he’s betting against the database company through put options.

Oracle Corporation, ORCL

Burry made the revelation in a Friday Substack post. He also confirmed he directly shorted Oracle shares over the past six months.

This follows his November disclosure of bearish positions against Nvidia and Palantir. But Burry seems particularly unimpressed with Oracle’s current direction.

Oracle has been aggressively expanding into cloud computing. This requires massive spending on data center infrastructure. The company is taking on substantial debt to fund this buildout.

Oracle’s Volatile Year

Oracle shares experienced wild swings in 2024. The stock jumped 36% in a single September session after the company issued bullish cloud forecasts tied to AI demand.

Those gains evaporated quickly. Investors grew concerned about rising capital expenditures. Questions emerged about cloud deal structures. The growing debt load raised eyebrows.

Oracle finished the year roughly 40% below its September peak. The company now carries about $95 billion in outstanding debt. That makes Oracle the biggest corporate bond issuer outside the financial sector in the Bloomberg high-grade index.

Burry didn’t disclose specific details about his put options or short position sizes.

Why Oracle and Not the Big Tech Giants?

Burry explained his selective approach to shorting tech stocks. He’s avoided betting against Meta, Alphabet, and Microsoft despite their AI investments.

These companies have diverse revenue streams beyond AI. They can absorb losses from AI overinvestment while their core businesses remain strong.

Oracle lacks that safety net. The company’s cloud push represents a major strategic shift requiring enormous capital. Burry sees this as a vulnerable position.

Burry even said he’d short OpenAI at a $500 billion valuation. This underscores his broader skepticism about AI economics and buildout pace.

Oracle didn’t respond to requests for comment outside regular business hours.

The post Oracle (ORCL) Stock: Michael Burry Reveals Put Options and Short Position against Cloud Giant appeared first on CoinCentral.