Michael Burry’s software stock bets expose the gap between AI fears and valuation reality

Three software stocks are down more than 20% this year not because they broke, but because investors panicked. Michael Burry sees that drop as a mispricing. He’s taken new positions in Autodesk (ADSK) and Veeva Systems (VEEV), and added to his existing stake in Adobe (ADBE)—all names battered by fears that artificial intelligence will erode their business models. The market treated the entire software sector as vulnerable, punishing high-quality companies alongside weaker peers. Burry argues the credit-side risks aren’t significant enough to sustain further declines. His view: the selloff has been overdone, driven by irrational anxiety over AI disruption rather than fundamentals. That disconnect has pushed valuations low enough to offer attractive entry points. Analysts now estimate upside potential for each stock exceeding 30%.