Palantir and Nebius Forge Alliance, Pressuring Burry's Twin Bearish Bets

Palantir Technologies and Nebius Group announced a strategic partnership on Tuesday, designating Nebius as Palantir's preferred sovereign AI infrastructure partner.

The news is awkward for Michael Burry, who has disclosed bearish bets against both companies.

Under the agreement, Nebius's AI-native compute and inference infrastructure will eventually be deployed within Palantir's enterprise security perimeter, enabling eligible Palantir customers to deploy and fine-tune open models on Nebius hardware while retaining control over their own data and models.

The two companies also plan to accelerate new compute capacity through modular data center deployments at sites with available power.

"Nebius's compute infrastructure lets you run your own AI models under your own control," Palantir CEO Alex Karp said in the announcement.

Nebius CEO Arkady Volozh added that the partnership allows customers to "run their optimized open models on trusted infrastructure."

Following the announcement, the two stocks moved in opposite directions. Nebius rose 7.73% on Tuesday to close at $243.88, while Palantir fell approximately 2.31% to $170.30.

Burry's bearish positions on PLTR and NBIS

Burry holds out-of-the-money put options on Palantir, arguing that the stock's roughly $420 billion valuation and trailing P/E ratio above 137 times have fully priced in near-perfect long-term execution.

He disclosed a new short position in Nebius in early August, part of a broader bearish portfolio that also includes Nvidia, Micron, Oracle, and Caterpillar, with the core thesis that new cloud operators like Nebius underestimate GPU depreciation.

His argument already appears shaky: Nebius rose nearly 10% in August alone, following the company's report of 454% year-over-year revenue growth and an annualized revenue run rate of $3 billion; Palantir gained over 5% in August on its ninth consecutive earnings per share beat.

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Key Takeaways

Tuesday's partnership news—deepening Nebius's enterprise reach through Palantir's customer base and strengthening Palantir's sovereign AI positioning—brings a fresh bullish narrative for both companies just as Burry's short book expands.

Investors will be watching whether Burry makes any adjustments to his positions.