Nebius Group shares surged 34% in a single session and are now up 77% over the past two weeks, a sharp reversal that traces back to one of the more dramatic hedge-fund blowups of the year. The rebound began right after Leopold Aschenbrenner's Situational Awareness fund was forced to liquidate its entire public book, including a large Nebius position, in a single block trade to Citadel on July 30.
Aschenbrenner had turned roughly $225 million into as much as $45 billion in under two years, running concentrated, heavily leveraged bets on AI infrastructure names including Nebius and CoreWeave. Reported leverage of up to 400% meant that when the trade turned, margin calls wiped out an estimated $35 billion in days, forcing a fire-sale of the entire portfolio to Citadel at a discount. Nebius was one of the fund's largest holdings before the forced sale.
Burry Calls It the Top of the Boom
Just as Nebius has clawed back those losses and then some, Michael Burry has been positioning against it. In an August 6 post on his Substack, Cassandra Unchained, Burry disclosed a short on Nebius at $211.77 alongside a short on Oracle at roughly $145, calling the trades “a bit like shooting fish in a barrel.” His argument centers on AI infrastructure companies depreciating expensive GPU hardware too slowly, which he estimates could overstate Oracle's profits by 26-27% by 2028 — a critique he's extended to the broader AI infrastructure trade.
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Burry has continued to lean into the bearish call even as the stock has moved against him. He has framed Nebius as emblematic of late-cycle excess, writing that the current setup is “what the top of a boom looks like” and adding to his existing short rather than trimming it.
A Short Squeeze Working Against the Bear Case
The trade hasn't gone smoothly so far. Nebius posted a blowout earnings report showing 454% year-over-year revenue growth in the days after Burry's short was disclosed, and the stock's subsequent rally has reportedly left his position underwater. Whether Burry's thesis on GPU depreciation accounting eventually plays out is a longer-term question, but in the near term, the stock's recovery from Aschenbrenner's forced liquidation has proven far sharper than the bearish case anticipated.
