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Michael Burry Warns: AI GPUs Face Rapid Depreciation

11/19/2025

Summary

Story summary

Michael Burry, investor known for the "Big Short," argues that hyperscalers like Google and Microsoft should depreciate their GPUs in under three years.
Critics say this schedule is aggressive accounting because GPUs can become obsolete quickly.
High utilization rates in AI workloads accelerate the physical degradation of GPUs.
If depreciation schedules do not reflect real-world cycles, companies risk overstating profitability and potentially fueling an AI bubble.

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Story summary

Michael Burry, investor known for the "Big Short," argues that hyperscalers like Google and Microsoft should depreciate their GPUs in under three years.
Critics say this schedule is aggressive accounting because GPUs can become obsolete quickly.
High utilization rates in AI workloads accelerate the physical degradation of GPUs.
If depreciation schedules do not reflect real-world cycles, companies risk overstating profitability and potentially fueling an AI bubble.