By Sheryl Sheth
Publication Date: 2025-11-25 11:05:00
Chip giant Nvidia (NVDA) has finally responded to Michael Burry’s repeated allegations of accounting malpractices among hyperscalers and what he calls an overinflated artificial intelligence (AI) bubble. Over the weekend, Nvidia’s investor relations team sent a seven-page memo to Wall Street analysts, firmly rejecting Burry’s accusations as well as those from skeptical investors.
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Nvidia also rejected claims that its current accounting situation is similar to past accounting scandals involving Enron, WorldCom, and Lucent, which used tactics like vendor financing and special purpose vehicles (SPVs). The company emphasized that its business remains financially robust, its reporting is transparent and comprehensive, and it values its reputation for integrity.
Nvidia Pushes Back on Burry’s Claims
After Nvidia reported stellar third-quarter results last week, Burry took aim at the chip maker once again on his X account. This time he accused Nvidia of eroding shareholder value through excessive stock-based compensation dilution, stock buybacks, circular cash flows, and questionable depreciation practices.
Nvidia clarified that Burry miscalculated stock buybacks by incorrectly including RSU (restricted stock unit) tax-related figures. “Nvidia repurchased $91 billion shares since 2018, not $112.5 billion,” the memo stated. The company also explained that employee equity grants should not be mixed with its share repurchase program….
