America’s biggest investor Michael Burry is not happy with reports of Nvidia investing $250 billion in Sam Altman’s OpenAI; his complaint is what has been analysts biggest concern with $100 billion-plus AI deals
America’s biggest investor, Michael Burry has voiced his sharp criticism of reports that Nvidia is preparing a a $250 billion backstop for OpenAI’s massive Ohio data-center project. According to a report by the Wall Street journal, the guarantees would help OpenAI lease a 10-gigawatt site being developed by SoftBank’s SB Energy, with total costs potentially exceeding $500 billion. Burry’s complaint echoes what analysts have long warned about in AI megadeals: circular funding arrangements that expose investors to enormous risk if sentiment shifts or growth slows. Nvidia, already valued at $5 trillion, has invested $30 billion in OpenAI and is now considering financing chip purchases worth another $350 billion. Critics say such structures could leave the industry vulnerable, especially since OpenAI remains unprofitable and lacks an investment-grade credit rating.
Government and global stakes
The Ohio project is backed by US federal land and Japanese investment under a trade deal, with Commerce Secretary Howard Lutnick involved in allocating power. Japan has pledged $33 billion to the natural-gas plant supplying the site, while the U.S. government will eventually claim 90% of revenue once Japan recoups its share. The project, located on a decommissioned uranium-enrichment site, is expected to deliver its first 800 megawatts of power by 2028.
Michael Burry’s warning
Burry’s criticism underscores growing unease about the sustainability of $100 billion-plus AI financing structures. His warning suggests that while AI demand is surging, the industry’s reliance on complex guarantees and debt-backed megaprojects could become its biggest vulnerability.
Michael Burry to everyone saying software companies are ‘dead’
Recently, Michael Burry published a software-sector sector research report on May 29 and made it freely available on June 21 outlining which companies he believes are best positioned for the AI era and which face greater disruption risks. Burry pushed back against claims that software companies are ‘dead’, arguing that large language models (LLMs) cannot replace human creativity. “LLMs, no matter how advanced they get at being LLMs, will never beat that creative instinct of a talented human being,” he wrote. He also cited Adobe as a company unfairly discounted by investors, pointing to its expanding AI offerings like Firefly, Firefly Foundry, and Acrobat AI, and its distribution across ecosystems including OpenAI, Anthropic, Google, and Microsoft.Along with this, Autodesk was highlighted as well-positioned, given its role in industries where expertise, accountability and regulatory requirements remain central areas where AI tools cannot easily substitute human oversight.
