Prominent investor Michael Burry, known for his prediction of the 2008 financial crisis, has accused Oracle and Meta of artificially inflating their earnings. In a social media post, Burry claimed the tech giants are understating depreciation expenses for their AI chips and servers by assigning them an unrealistically long "useful life." This accounting practice, he argues, reduces annual depreciation costs and makes profits appear larger. Burry specifically estimated that this method could overstate Oracle's profits by approximately 27% by 2028. He characterized this practice as "one of the more common frauds of the modern era," suggesting that the rapid two-to-three-year product cycles of AI hardware make extending their lifespan on paper misleading. These allegations raise significant questions about the true value and profitability of the company's substantial investments in AI infrastructure.
Investor Michael Burry Accuses Oracle of Inflating Profits Through Accounting Practices
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