Michael Burry Says SOX 'Will Return To Earth' — And Reveals Fresh $330 Puts On Key Semiconductor ETF

• The Philadelphia Semiconductor Index (SOX) has climbed about 148% in the past year, while the SOXX has rallied more than 150% in the same period.
• In comparison, the S&P 500 index has risen about 29.6% in the same time, while the tech-heavy Nasdaq 100 has gained 40.5%. 
• Meanwhile, the Kobeissi Letter noted in a post on X that AI infrastructure stocks have outperformed the S&P 500 by 115% since December 2023, more than any other AI-related category.

A relentless rally in semiconductor stocks this year has pushed several large plays higher amid surging AI-driven data center demand, but “The Big Short” investor Michael Burry is betting against it after having repeatedly cautioned against the current boom.

Burry noted that the Philadelphia Semiconductor Index (SOX), which tracks 30 of the largest U.S.-listed semiconductor companies, including Nvidia (NVDA), Broadcom (AVGO), Micron Technology (MU), and Intel (INTC), has had a sharp upward trajectory.

He is positioned for a pullback on the sector. “I know the SOX will return to earth. Older semiconductor guys know it too. What is happening now is technical,” Burry said in a post on Substack.

The contrarian investor also revealed that he has purchased puts on the 
iShares Semiconductor ETF (SOXX), another popular exchange-traded fund tracking American semiconductor plays. “I purchased a decent number of SOXX January 2027 puts struck at $330. This is a new position for me,” the investor said in his latest post.

Semiconductors Zoom Past Benchmark Indexes

The SOX has climbed about 148% in the past year, while the SOXX has rallied more than 150% in the same period, logging a record 18 consecutive trading sessions in the green, far outperforming benchmark indices. For context, the S&P 500 index has risen about 29.6% in the same time, while the tech-heavy Nasdaq 100 has gained 40.5%.

Apart from surging demand for chips, semiconductor stocks have been further bolstered by strong earnings from leaders like Nvidia and Intel, as well as a boom in AI infrastructure names. In March 2026 alone, three companies linked to the AI infrastructure boom directly joined the S&P 500: these include Vertiv Holdings Co. (VRT), Lumentum Holdings Inc. (LITE), and Coherent Corp. (COHR).

The Kobeissi Letter, which provides industry-leading market commentary, said in a post on X that AI infrastructure stocks have outperformed the S&P 500 by 115% since December 2023, more than any other AI-related category. “AI infrastructure stocks are driving the revolution,” it noted.

It is also worth noting that the Direxion Daily Semiconductor Bull 3X Shares (SOXL), a highly leveraged ETF that provides 300% of the daily performance of the ICE Semiconductor Sector Index, has skyrocketed 944% in the last year. Its counterpart, the Direxion Daily Semiconductor Bear 3X ETF (SOXS), which bets on a falling semiconductor sector, has declined nearly 97% in the last year.

The Contrarian Bet

Burry, famous for his contrarian value investing, has often voiced his concerns over the "unsustainable" AI boom. He has also compared AI darling Nvidia to Cisco in the early 2000s, saying that while both built strong ecosystems, Nvidia lacks the contractual lock-in that helped Cisco maintain its dominance.

“The current narrative, shortages in the face of wild data center expansion, is a powerful one,” he said, highlighting a note from another user called Kakashii, which alleged a reported order cancellation by Oracle (ORCL) could leave Super Micro Computer (SMCI) with excess inventory and potentially create knock-on risks for Nvidia if payments are delayed. “If I still had longs in this space, I would sell them here,” Burry added.

Meanwhile, on Stocktwits, retail sentiment around both SOXX and SOXL was in the ‘extremely bullish’ territory at the time of writing, while that for SPDR S&P 500 ETF Trust (SPY), which tracks the S&P 500, was in the ‘neutral’ territory.

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