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MICHAEL BURRY SAYS BIG TECH IS MANIPULATING AI PROFITS.
Burry says Companies choose how many years they depreciate their AI chips over, and that choice directly changes how much profit they report.
Two companies can use the exact same chip and book completely different numbers depending on the useful life they pick.
He points to Amazon and Meta as the clearest example.
In early 2025, Amazon shortened the useful life of some of its servers from 6 years to 5 years, which added $677 million in extra expense over 9 months.
In that same period, Meta did the opposite, stretching useful life to 5.5 years, which cut its depreciation hit by $2.9 billion. Same hardware, same industry, opposite accounting decisions, and both are completely legal.
Here's how the major players have shifted their numbers over time:
Meta: 3 years in 2020, now 5.5 years in 2025
- Google: 3 years in 2020, now 6 years
- Microsoft: 3 years in 2020, now 6 years
- Amazon: 4 years in 2020, now 5 years, after briefly dropping to 5 from 6
Burry's point is that depreciation isn't really measuring how long a chip physically works.
It's a lever companies can pull to smooth or boost reported profits. Even the people building this hardware admit the pace of change is the real problem.
Nvidia's own CEO said once Blackwell ships in volume, "you couldn't give Hoppers away." Microsoft's CEO has said he didn't want to get stuck depreciating one chip generation over too many years.
At the same time, the physical buildout is still extremely early. As of July 1, only about 100,000 of Nvidia's newest Grace Blackwell GPUs were actually deployed and running, out of an announced pipeline of 1.66 million.
That's roughly 94% of announced capacity not yet installed.
Rental prices for older chips are climbing anyway. A100 prices rose 6.3% in June alone, and H100 prices just posted their seventh straight monthly increase, despite being 2020 and 2022 hardware.
Nvidia's own cash conversion cycle has stretched to 113 days, up sharply from a low of 58.9 days a few years ago.
This is the manipulation Burry is pointing to.
Two companies with the same chips can report opposite profit swings worth billions, not because the hardware changed, but because they picked a different number on a form.
Strong demand and rising rental prices don't change that.
The profits being reported across this entire industry rest partly on assumptions each company sets for itself.