Peter Thiel's Fund Divests from Nvidia Amidst Rising AI Bubble Concerns

A recent social media post suggesting that Artificial Intelligence is "under-hyped" has sparked renewed discussion, contrasting sharply with growing market anxieties and recent significant investment shifts. This perspective, articulated by a user identified as Samswara, challenges the prevailing narrative of an overheated AI sector, even as influential figures like Peter Thiel take cautionary measures.

Samswara stated, "> My thiel contrarian opinion is that AI is under-hyped." This statement echoes the philosophy of venture capitalist Peter Thiel, known for his contrarian investment strategies. Thiel himself has previously expressed a nuanced view, suggesting that while AI is transformative, its true impact may unfold over decades, and current market enthusiasm could be premature.

However, recent actions by Thiel's hedge fund, Thiel Macro LLC, indicate a more immediate concern regarding market valuations. In the third quarter of 2025, the fund fully divested its entire 537,742-share stake in Nvidia, a leading AI chip manufacturer. This move, valued at approximately $100 million, signals a significant shift away from pure-play AI bets and into more diversified tech giants like Apple and Microsoft.

This divestment by a prominent tech investor like Thiel has intensified fears of an "AI bubble," drawing comparisons to the dot-com era of 1999. Analysts suggest that while AI technology is undoubtedly transformative, the rapid capital expenditure and soaring valuations of many AI-related companies may be running ahead of their actual economic fundamentals and proven revenue models.

Despite Nvidia's strong earnings report following Thiel's exit, which exceeded Wall Street expectations, the broader market remains cautious. The "Magnificent Seven" tech giants, heavily invested in AI, have seen increased scrutiny, with fund managers citing an AI bubble as a top "tail risk." This indicates a growing disconnect between technological potential and sustainable market performance.