Investor Michael Burry is confident that the market has adjusted its attitude towards AI

cryptonews.ruPublicado a 2026-07-27Actualizado a 2026-07-27

Resumen

Investor Michael Burry believes the market has already delivered its verdict on major tech companies' investments in artificial intelligence. Investors are now favoring companies with high profitability over those making significant capital expenditures. According to a Bloomberg chart shared by Burry, Wall Street has reduced investments in many of the tech firms investing most heavily in AI. Companies like Alphabet, Amazon, Microsoft, Meta, and Oracle have underperformed the broader market since early June. Alphabet, despite having the highest projected capital expenditures for the next 12 months, was the worst performer. Another chart shows that forward price-to-earnings ratios for Nvidia, Microsoft, Amazon, Alphabet, and Meta have declined from recent peaks as investors reevaluate AI investment prospects. Burry commented, "The market has voted, and the results are clear." This shift in sentiment has pressured the "Magnificent Seven" stocks, with a related ETF down 3.37% year-to-date. Notably, venture capitalist Chamath Palihapitiya defended Alphabet's AI spending, citing its history of high returns on invested capital. Alphabet's Class A shares closed at $319.74, gaining 0.65% on Friday and rising another 1.56% in pre-market trading on Monday.

Famous short-seller Michael Burry is convinced that the market has already passed its verdict on major tech companies' investments in artificial intelligence (AI). Investors are now favoring companies demonstrating high profitability, not companies with large capital investments.

According to a Bloomberg chart shared by Burry on social media, Wall Street has reduced investments in many of the tech companies investing the most capital in AI. At the same time, Google's parent company Alphabet Inc., Amazon.com Inc., Microsoft Corp., Meta Platforms Inc., and Oracle Corp. have underperformed the broader market since early June.

Alphabet was the worst performer among all companies in the group, despite having the highest projected capital expenditures for the next 12 months.

Another chart reflected a revision of valuation estimates for many major tech companies: forward price-to-earnings ratios for Nvidia Corp., Microsoft, Amazon, Alphabet, and Meta have fallen from recent peaks as investors reassessed the prospects of AI investments.

The market has voted, and the results are clear, — Burry commented on the situation.

The shift in sentiment has also put pressure on the "Magnificent Seven" stock market — the Roundhill Magnificent Seven ETF is down 3.37% year-to-date.

Interestingly, venture capitalist Chamath Palihapitiya came to the defense of Alphabet's AI spending following the company's latest earnings report. He stated that Alphabet's long history of high returns on invested capital gives its management a "presumption of innocence" due to the "capital compounding machine" it has built.

Alphabet Class A shares closed Friday at $319.74, up 0.65%, and added another 1.56% in Monday's premarket trading. Class C shares rose 0.24% on Friday to $319.09, and then gained 1.51% in premarket trading.

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Preguntas relacionadas

QAccording to Michael Burry, what shift in investor preference is currently happening regarding AI investments?

AInvestors are now favoring companies that demonstrate high profitability rather than those making large capital investments in AI.

QWhich major tech companies were specifically mentioned as underperforming the broader market since early June, according to the Bloomberg chart shared by Burry?

AAlphabet Inc., Amazon.com Inc., Microsoft Corp., Meta Platforms Inc., and Oracle Corp.

QWhat metric for several big tech companies has declined from recent peaks, reflecting a reassessment of their AI investment prospects?

ATheir forward price-to-earnings (P/E) ratios have fallen.

QHow has the Roundhill Magnificent Seven ETF performed since the start of the year, according to the article?

AIt has fallen by 3.37% since the start of the year.

QWhat reason did venture capitalist Chamath Palihapitiya give for defending Alphabet's AI spending after its latest earnings report?

AHe stated that Alphabet's long history of high returns on invested capital gives its management a 'presumption of innocence' due to the 'capital compounding machine' it has built.

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