Michael Burry initiates first-ever short position in Caterpillar after AI rally

Michael Burry, the investor who became a household name for predicting the 2008 housing crash, is now betting against Caterpillar for the first time in his career. The move represents his latest salvo against what he sees as an overheated AI market that has inflated valuations well beyond reason.

“Caterpillar jumped out at me,” Burry said. “I have never shorted Caterpillar.”

CAT shares surged nearly 100% during the 2026 AI rally, peaking near $1,061 before Burry decided to go short.

The broader Burry playbook against AI

Caterpillar isn’t an isolated bet. As of June 30, 2026, Burry has also increased short positions on NVIDIA, Tesla, and Applied Materials.

In Q3 2025, Scion held put options on 5 million shares of Palantir, representing roughly $912 million in notional value, alongside puts on 1 million NVIDIA shares worth approximately $187 million notional. Combined, those two bets alone were worth around $1.1 billion in exposure.

Burry has specifically called out companies like Oracle, Google, and Microsoft for their aggressive data center buildouts, warning that the financial risks of such heavy capital consumption are being ignored by a market drunk on AI optimism. Burry has explicitly drawn comparisons between the current AI rally and the dot-com bubble of 1999-2000.

Why Caterpillar specifically

Caterpillar is not an AI company. It builds heavy machinery for construction, mining, and energy. But the massive data center construction boom, driven by hyperscalers racing to deploy AI infrastructure, has created a surge in demand for exactly the kind of earth-moving equipment Caterpillar sells. The market priced in that benefit aggressively, nearly doubling the stock.

The absence of a confirmed 13F filing for the Caterpillar short as of June 30, 2026, means investors are working with commentary and social media signals rather than verified regulatory disclosures. Scion’s next 13F filing will provide harder data on the exact size and structure of the position.