Michael Burry’s recent $1 billion short position targeting Palantir has added pressure to the already weakening AI sector. Since the trade became public, Palantir shares have fallen roughly 30%, marking one of the steepest declines among major artificial intelligence equities. The move reflects rising skepticism toward high-multiple growth stocks after a long period of outperformance.
The selloff has broadened across mega-cap technology names. Oracle is now down 44% from its record high, while Meta and AMD each sit 27% below their peaks. Tesla and Netflix have slipped 22%, Nvidia is down 19%, Amazon 17%, Microsoft 16%, and Broadcom 15%. The declines signal a notable shift in investor appetite away from the largest tech leaders.
Analysts say the combination of stretched valuations, slowing momentum, and defensive repositioning is driving the reset. With several flagship tech names now in what many define as a bear-market range from their highs, investors are reassessing how much future AI growth is already priced into earnings expectations.
