Here's a fun twist on the Nvidia (NVDA) skepticism narrative: turns out Michael Burry wasn't the first prominent investor to bail on the AI chipmaker while citing serious concerns. Peter Andersen, CIO of Andersen Capital Management, told the Schwab Network he completely dumped his Nvidia stake last summer—months before the current wave of bearish scrutiny—because he saw accounting issues coming from a mile away.

Getting Out Early

Andersen's timing was prescient. He told Schwab Network that the accounting accusations now swirling around Nvidia were basically inevitable. "I sold all our NVIDIA shares way back in the summer," he explained, adding that he anticipated "that some of this stuff would actually come into focus."

And he thinks what we're seeing now is just the beginning. The specific accounting concerns making headlines today are merely the "tip of the criticism" the company should face, according to Andersen.

His exit effectively front-ran recent attacks from "Big Short" investor Michael Burry, who has shorted the stock and criticized Nvidia's buyback strategies while comparing the AI frenzy to the dot-com bubble. The mounting pressure got intense enough that Nvidia recently issued a private memo to analysts explicitly denying comparisons to historical accounting frauds like Enron.

The Fantasy at the Core

But Andersen's skepticism runs deeper than financial engineering concerns. He fundamentally doesn't buy the narrative driving Nvidia's astronomical valuation. The "idealistic model" suggesting AI will soon replicate human thought? That's a dangerous delusion, in his view.

"I just think that it is so wrong, so far-fetched," Andersen said about the idea of replacing the human brain. "But yet people are moving on with that fantasy."

The Demand Question

Andersen also warned about massive "overbuilding" in data center infrastructure without corresponding real-world demand to justify it. He questioned whether viable business plans actually exist for all this new capacity.

His evidence? Flagship tools like ChatGPT aren't "locking up" from overuse. If genuine user demand was truly outstripping supply, you'd see systems crashing or slowing down—but that's not happening, he argues.

Not everyone agrees with this assessment. Shay Boloor, chief market strategist at Futurum Equities, pushed back with the thesis that today's AI cycle differs fundamentally from the dotcom bubble. He noted that GPU utilization runs as high as 80% of total capacity, compared to the dismal utilization rates of fiber optics back in 1999.

The Stock Keeps Climbing

Despite all this skepticism, Nvidia shares have climbed 30.33% year-to-date, outpacing the Nasdaq 100 index's 20.32% return over the same period. Over the past year, the stock has gained 33.19%. On Wednesday, shares rose 1.37% to $180.26.

The stock maintains a stronger price trend over the long term but shows weakness in short and medium-term trends, with a poor value ranking according to market data.

So what's an investor to make of all this? Andersen placed his bet last summer, getting out before the storm. Burry is actively shorting. And yet the stock keeps marching higher. The AI story might be a fantasy, or it might be the next industrial revolution. Either way, it's shaping up to be one of the more fascinating market debates in years.