‘Big Short’ Michael Burry Calls Palantir An ‘AI FOMO’ Consultant — Warns Market Cap Could Crash Below $100B

• Burry flagged receivables rising to $1.49 billion, with one customer accounting for 27% despite contributing less than 10% of revenue.
• He argued that Palantir’s deferred-revenue pattern and 32% deferred revenue-to-revenue ratio resemble consulting firm Accenture more than SaaS peers.
• Burry criticized Palantir’s stock-based compensation and $9 billion in federal net operating losses, declaring that “the stock price is the business model.”

“Big Short” investor Michael Burry has renewed his bearish attack on Palantir, saying that the AI favorite resembles a consulting business more than a software company and warning that its lofty valuation could collapse below $100 billion. 

Palantir's AI-fueled rally has boosted the bull case and helped send Palantir’s valuation soaring to $407.2 billion. Burry, however, argues that the headline growth masks troubling patterns in the company’s financial statements. “Palantir is back in the stratosphere,” he said. “The facts have not changed.”

PLTR stock slid 6% on Wednesday to close at $169.46, its worst session in over a week. Shares are also tracking their worst week in over two months. 

Burry Warns Palantir Is In An AI Bubble 

“Palantir is a consultant riding a bubble of AI FOMO demand,” the investor famed for predicting the housing crash said on X. Even if the corporate AI scramble lasts several more years, Burry warned, “the fall will be just as epic, or more so.”

Burry’s attack follows another blockbuster quarter for Palantir, with second-quarter (Q2) revenue surging 93% to $1.94 billion. U.S. commercial revenue jumped 149% to $764 million, while U.S. government revenue rose 90% to $809 million. Palantir also raised its 2026 revenue outlook to $8.15 billion, implying growth of about 82%.

Burry Questions Palantir’s Rising Receivables

Burry’s accounting case is based on Palantir’s rising accounts receivable and its concentration with one customer. Receivables climbed to $1.49 billion as of June 30 from $1.04 billion at the end of 2025. One customer represented 27% of receivables despite no customer generating more than 10% of revenue.

Burry said receivables grew faster than revenue in nine of the previous 12 quarters, potentially indicating extended payment terms or billing ahead of delivery. “Either the customer was being invoiced ahead of delivery (channel stuffing) or the customer was not paying on time (or was on extended payment terms).,” he wrote. “Neither option is good.” He said that the concentration gives the customer considerable negotiating leverage since Palantir cannot easily afford a major write-down. “What we have here, it seems, is a customer holding the leverage because Palantir’s stock price is more fragile than the customer’s budget.” 

Palantir’s SaaS Status Faces Scrutiny

Burry also argued that Palantir’s deferred-revenue pattern resembles consulting firm Accenture more than subscription-software companies such as Salesforce and ServiceNow. He called that comparison the “kidney punch” to Palantir’s software narrative.

The “uppercut,” he said, is Palantir’s deferred revenue-to-revenue ratio of about 32%, which is close to Accenture’s 31% but below the 80% to 207% range he calculated for SaaS peers. “Palantir is just not what it claims to be,” Burry said. He cited an unverified private conversation among former Palantir engineers. One participant said Palantir’s historical “moat” was its people and that clients “weren’t really paying for the software,” but for teams willing to “work 80h non-stop.” Another apparently called Palantir’s AIP branding “bandwagon to the max.”

Burry Targets Palantir’s Stock Compensation

Burry also targeted Palantir’s stock-based compensation and tax benefits. Palantir reported about $1.6 billion in pretax GAAP income for 2025 but paid no federal cash taxes after applying net operating loss carryforwards. Federal net operating loss (NOLs) increased to $9 billion from $5.5 billion, a rise Burry largely attributed to stock-compensation-related deductions.

“Shareholders are funding employee compensation through dilution,” he said. “The government is subsidizing Palantir through gargantuan tax shields.” He also highlighted Palantir’s cancellation of a $1 billion buyback authorization after repurchasing roughly $75 million in 2025. Karp separately sold about 492,000 shares worth $86 million last month. “In so many ways, the stock price is the business model,” Burry said.

Burry Slams Alex Karp’s Private-Jet Spending 

Palantir disclosed that it incurred $17.2 million in expenses related to Karp’s personally owned aircraft in 2025, more than double the $7.7 million recorded a year earlier. Burry dubbed it the “$17.2 million mile-high club” and called the spending “profligate” and “egregious.” Jefferies analyst Brent Thill estimated that the expense could represent between 1,147 and 2,457 flight hours, depending on the aircraft’s operating costs.

How Do Retail Traders Feel About PLTR?

On Stocktwits, retail sentiment for PLTR slipped to ‘bearish’ from ‘neutral’ levels a week ago amid a 90% jump in 24-hour message volumes. The ticker’s watcher base has also increased 6% in a year, indicating a slight increase in retail interest. 

One user said, “$PLTR another example of a stock looking good and then bottom falls out. Market is and has been nasty for weeks.”

Another user said, “$PLTR looks like we are hitting support at $166, which had been resistance since february prior to the breakout in Aug.  Algos are in control here.  We could see a $190-200 resistance still prior to earnings.”

PLTR stock has risen 8% over the past year. 

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