Michael Burry, the investor known for his Big Short trade, accused several tech giants of using sinister accounting methods to hide the costs of the artificial intelligence infrastructure race. He alleges these companies employ aggressive maneuvers to overstate their reported profits.
Burry specifically targets Oracle, suggesting the company may be overstating its earnings by 48% to 62%. These figures depend on the assumed life cycle of the company's servers.
The warning identifies a potential disconnect between reported corporate profits and the economic reality of massive AI capital expenditures. This trend currently affects the broader technology industry.