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Nvidia Memo Sparks Investor Alarm: Michael Burry Calls Out Potential Deception

Source: 'Almost Reads like a Hoax', says Michael Burry, Wall Street's one of the biggest investor, on Nvidia memo (2025-11-27)

In a recent statement, renowned investor Michael Burry, famous for foreseeing the 2008 housing crisis, sharply criticized Nvidia’s internal memo, describing it as “almost reads like a hoax.” Burry alleges that Nvidia and other AI giants are engaging in misleading accounting practices, particularly around chip depreciation, to inflate short-term profits. He warns that extending the lifespan of AI hardware artificially boosts earnings but could lead to significant future write-downs, risking investor trust and market stability. This controversy arrives amid broader concerns about transparency in the rapidly evolving AI and semiconductor sectors, which are projected to reach a combined valuation of over $1.5 trillion by 2026. Recent developments include Nvidia’s record-breaking quarterly revenue of $22 billion, driven by surging demand for AI chips, and increased scrutiny from regulators worldwide, including the U.S. Securities and Exchange Commission (SEC) investigating potential accounting irregularities in tech giants. Additionally, the global chip market is expected to grow at a compound annual growth rate (CAGR) of 8.5% over the next five years, fueled by AI, 5G, and autonomous vehicle applications. Major competitors like AMD and Intel are ramping up their AI hardware offerings, aiming to challenge Nvidia’s dominance. Meanwhile, Wall Street analysts are divided: some see Nvidia’s valuation as justified by its innovation, while others echo Burry’s concerns about potential overvaluation and accounting risks. As the debate intensifies, investors are advised to scrutinize financial disclosures carefully, considering the broader implications for the tech industry’s transparency and sustainability. The controversy underscores the importance of rigorous due diligence in a sector where rapid growth often outpaces regulatory oversight, emphasizing the need for increased transparency and accountability in AI and semiconductor financial reporting.

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