Michael Burry says Anthropic IPO papers show AI industry is 'catastrophically vulnerable'.
What the 'Big Short' investor sees ETMarkets.com Burry in a Substack post pointed to Anthropic's huge spending commitments, slowing revenue, and tangled ties.
Synopsis Investor Michael Burry warned that Anthropic’s planned IPO exposes serious vulnerabilities in the AI industry, citing massive infrastructure commitments, slowing growth and mounting costs.
The investor, known for predicting the 2008 financial crisis, believes disappointing AI revenues could trigger a significant market correction and capital losses.
By Debaroti Adhikary, ETMarkets.com Oct 29, 2026, 01:47:00 PM IST Follow us Popular American investor Michael Burry has been ramping up his bets against AI stocks, warning that the artificial intelligence bubble is set to burst.
After Claude-maker Anthropic filed its IPO papers, Burry pointed out several red flags, saying that they show that the AI industry is “catastrophically vulnerable”.ADVERTISEMENT The company is preparing to market its shares after it filed for an IPO under the ticket ANT, although the number of shares to be released is yet to be determined.
Its eventual listing will give public-market investors a chance to buy into one of the leading developers of AI models, but the company’s rapid growth comes with mounting infrastructure costs, substantial losses and questions over how long its current growth trajectory can be sustained.
The American investor noted that the AI company has struck deals to buy about $537 billion of compute from Amazon, Alphabet, and Microsoft, and reached preliminary agreements worth hundreds of billions more with others such as SpaceXAI.
This puts its total commitments at about 12 times its current annual run-rate revenue.
"This is not stated clearly in the S-1, and in my view it is the most deserved headline from it," Burry wrote in a Tuesday Substack post.
"Overall slowing of growth is not attributed to a decline in tokenmaxxing, but I did not expect that to be mentioned,' he added.
“In that scenario, a handful of boards, predisposed to redeploy capital toward the highest-conviction bet, would simply need to conclude that the highest-conviction bet has shifted,” the report said.This comes after Burry said in August that the AI crash could begin from 2028.
However, his latest comments imply that he expects this to happen sooner.
Recently, he said the President Donald Trump-led US administration cannot afford to let the AI boom fail.
He explained that AI infrastructure buildout has become a critical support for the US economy, keeping very little room for the Trump administration to let the ongoing AI boom weaken, Stockwits reported.
Notably, Burry has been shorting AI-linked stocks and warning investors of a sharp selloff ahead.ADVERTISEMENT
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