Nvidia Memo Refuting Michael Burry's Accounting Allegations: Market Impact & Risk Analysis

On 2025-11-24, Nvidia released a private memo to analysts refuting Michael Burry’s accounting allegations (dilution from stock-based compensation, buyback claims), with the memo’s authenticity confirmed by Wall Street sources [4]. Reddit reactions were mixed: some criticized the memo’s Enron comparison framing, others dismissed Burry’s claims as unfounded [4]. NVDA’s 1.11% gain that day ($181.49 close) coincided with a tech sector rally (+2.12%) and rumors of resumed China chip sales, suggesting overlapping drivers of price movement [0,2]. Burry’s hedge fund holds $1 billion in NVDA put options, indicating a strong bearish stance [5].

1. Cross-Domain Correlation
   : The memo’s impact was tempered by broader tech sector momentum and China sales rumors, highlighting how multiple factors influence short-term price action [0,2].
2. Transparency Gap
   : The private nature of the memo raises questions about full disclosure, as investors lack access to its complete content—creating uncertainty despite the refutation [4].
3. Sentiment Divergence
   : Reddit’s mixed reactions mirror market ambiguity: bullish signals from sector rally vs. bearish signals from Burry’s put position [4,5].
4. Supply Chain Implications
   : Potential China sales resumption could significantly impact NVDA’s revenue, as the region is a major market for its chips [2].

• Bearish Sentiment
  : Burry’s $1 billion put position may amplify volatility if additional negative news emerges [5].
• Accounting Scrutiny
  : The memo’s release could trigger increased regulatory or investor scrutiny of Nvidia’s financial practices [4,2].
• China Uncertainty
  : Ongoing discussions about chip sales to China create revenue uncertainty [2].

• Tech Sector Momentum
  : The 2.12% tech sector gain on 11/24 suggests sustained investor interest in AI-related stocks [0].
• Regulatory Clarity
  : A positive outcome on China chip sales could boost NVDA’s revenue and investor confidence [2].
• Memo Transparency
  : Public disclosure of the memo’s full content could alleviate accounting concerns and support price stability.

• NVDA Price Movements
  : 2025-11-20 (-7.81%), 2025-11-21 (-1.30%), 2025-11-24 (+1.11%) [0].
• Sector Performance
  : Tech sector +2.12% (2025-11-24) [0].
• Burry’s Position
  : $1 billion in NVDA put options [5].
• Key Monitor Points
  : Public memo clarification, Burry’s position changes, China sales outcome, tech sector trends.

All data is sourced from verified internal and external references [0,1,2,3,4,5].