Renowned investor Michael Burry has initiated a short position in Oracle Corporation (ORCL), signaling growing skepticism about the company's ability to maintain momentum in the cloud computing sector. His move underscores concerns over slowing growth and competitive pressures in enterprise software.
- Michael Burry initiated a short position in Oracle (ORCL) based on concerns over cloud transition performance.
- Oracle’s cloud revenue grew only 11% YoY in Q4 2025, significantly below industry peers.
- Cloud infrastructure revenue accounts for under 20% of Oracle’s total revenue, compared to over 40% for AWS and Azure.
- ORCL’s forward P/E stands at 27, reflecting high valuation amid slowing growth.
- Market reaction included a 3.2% decline in ORCL shares and increased short interest activity.
- The move raises broader questions about legacy tech firms’ ability to adapt to cloud-driven market shifts.
Michael Burry, the investor famed for foreseeing the 2008 financial crisis through his 'Big Short' bets, has taken a notable short position in Oracle Corporation (ORCL), according to recent filings. The position, disclosed in a Form 13F filing, reflects Burry’s increasing caution toward large-cap tech names that may be overvalued amid shifting market dynamics. His strategy comes at a time when Oracle’s cloud revenue growth has decelerated, with Q4 2025 cloud revenue rising just 11% year-over-year, well below the 25%+ pace seen in prior quarters. Burry’s decision is rooted in structural concerns: despite Oracle’s dominant presence in legacy enterprise systems, the company is lagging in public cloud infrastructure, where competitors like Amazon Web Services and Microsoft Azure continue to expand market share. Oracle’s cloud infrastructure revenue, while increasing, still represents less than 20% of total revenue, a fraction of the 40%+ seen at AWS and Azure. Analysts note that Oracle’s strategy of relying on on-premise software sales may hinder its agility in the cloud era. Market participants have taken note. Following the disclosure, ORCL shares dipped 3.2% in early trading, with options activity indicating rising short interest. The move has sparked debate among investors about whether Oracle’s high valuation, currently trading at a forward P/E of 27, is justified given its slower innovation cycle and declining customer acquisition in cloud services. Burry’s reputation as a contrarian investor with a track record of identifying systemic risks adds weight to his stance. The implications extend beyond Oracle. As a major player in enterprise software, a downturn in ORCL could signal broader challenges for legacy tech firms struggling to transition to cloud-based models. Investors in software and IT infrastructure are now re-evaluating exposure to large-cap incumbents with high market caps but slowing cloud adoption.