Michael Burry has exited his bullish Microsoft trade and closed his remaining bearish Oracle position, but one prominent artificial-intelligence wager is still alive: Palantir stock.
That decision looks provocative after Palantir shares surged nearly 30% on Tuesday following another blowout quarter.
The contrast suggests Burry’s remaining bet is less about whether AI demand exists and more about whether extraordinary growth can justify Palantir’s valuation.
Palantir delivered the quarter bears did not want
Palantir’s second-quarter revenue jumped 93% from a year earlier to $1.94 billion, beating Wall Street’s $1.80 billion estimate. Adjusted earnings reached 41 cents a share, ahead of expectations for 35 cents.
US commercial revenue surged 149% to $764 million, while US government sales climbed 90% to $809 million.
Management raised full-year revenue guidance to between $8.150 billion and $8.158 billion and forecast third-quarter sales above consensus.
Those numbers directly challenge several bearish arguments surrounding the company.
Morgan Stanley analysts called Palantir’s streak of accelerating quarterly revenue growth a “remarkable achievement,” adding that demand remained “extraordinary.”
William Blair said the company’s “stellar performance defies concerns” that OpenAI and Anthropic could weaken its competitive position.
That matters because Burry has questioned Palantir’s business model, valuation and vulnerability to increasingly capable general-purpose AI systems.
Burry’s strongest argument may now be valuation
The operational momentum does not eliminate the stock-market risk.
Jefferies analysts acknowledged Palantir’s execution after earnings but warned that its valuation “leaves little room for a normalization in growth or execution slippage.”
Analyst Brent Thill has remained bearish despite recognising Palantir’s position at the forefront of enterprise AI.
TipRanks reported that he views the risk-reward as unfavourable because the shares require unusually durable growth to support their revenue multiple.
That offers the clearest explanation for why Burry can remain short after an excellent quarter.
His position does not require Palantir’s sales to collapse next quarter. It requires growth, margins or investor enthusiasm eventually to slow enough for the valuation multiple to compress.
A company can continue beating estimates while its shares become vulnerable if expectations rise faster than earnings.
Burry’s February analysis went further, questioning Palantir’s receivables, economics and long-term competitive position.
The latest results challenge parts of that thesis, but they do not answer what investors should pay for the business.
Microsoft and Oracle show Burry will change course
Burry’s other trades make his Palantir stance more significant because he has demonstrated a willingness to exit when the risk-reward changes.
His Microsoft position was bullish. He bought long-dated calls earlier this year before closing the trade in his update.
Oracle was bearish, as Burry criticised its AI infrastructure commitments, rising debt and capital requirements, then reduced the position as the shares weakened before closing it completely.
MarketWatch reported that he still maintains bearish exposure to Palantir even after removing other positions and rolling some semiconductor bets further into the future.
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