Michael Burry says neither SpaceX nor Anthropic is worth $1T

Original Article ↗ Hacker News Discussion ↗

Valuation of Anthropic and SpaceX

  • Many agree the article’s short-seller is likely right that neither firm fundamentally merits a $1T valuation today.
  • Others argue Anthropic could justify $1T if AI becomes an essential work utility with hundreds of millions of paid seats, but admit that’s a speculative best-case.

Moats, Competition, and AI Economics

  • Several see weak moats for LLM providers: you’re only “as good as your latest model,” with multiple high-quality competitors and much cheaper open or foreign models.
  • Counterpoint: enterprise contracts, integrations, and conversation history create strong inertia; large orgs won’t switch easily unless savings are massive.
  • Concerns that if GPU suppliers diversify or cheapen, margins and valuation power for model vendors will erode.

Revenue, Profits, and Valuation Metrics

  • Dispute over Anthropic revenue: numbers like $4.5B in 2025 and bigger extrapolations are cited but treated with skepticism.
  • Repeated point: current or rumored revenue and negative/fragile profitability do not justify 20x+ sales or 0.2% earnings yield.
  • Some emphasize traditional P/E and a clear path to sustainable profit; others think “growth story” valuations dominate anyway.

Passive Investing, Index Rules, and Systemic Risk

  • Strong criticism of index rules that would force rapid inclusion of huge IPOs into major indices within days.
  • Fears this creates a wealth transfer from pensions/ETFs (forced buyers at any price) to pre-IPO insiders.
  • Concern that high index concentration and passive flows decouple prices from fundamentals and make the system fragile.

Market Behavior, Bubbles, and Timing

  • Many see AI, like dotcom and memestocks/crypto, as a bubble driven by zero/low rates, hype, and “vibes.”
  • Recurrent theme: markets can stay irrational longer than skeptics stay solvent; betting against AI hype or mega-cap tech has been ruinous in recent years.
  • Some think an eventual crash is inevitable and large, others note prior “booms” (internet, railroads) left lasting value despite crashes.

AI Adoption and Personal Investing Responses

  • Mixed views on AI as “essential utility”: some daily heavy users say cheap models already suffice; others see transformative productivity.
  • Several commenters are actively shifting out of broad US indices or reducing exposure, preferring more “stable” or custom direct-index portfolios that can exclude AI/high-flyer names.