Billionaire Peter Thiel has sold his entire stake in Nvidia Corporation (NASDAQ:NVDA) and significantly cut his holdings in Tesla Inc. (NASDAQ:TSLA), apparently amid growing apprehensions of a potential AI bubble.

Thiel offloaded approximately 537,742 Nvidia shares during the July-September period, according to a Form 13F filing from his Thiel Macro fund. The filing confirmed that Thiel held no Nvidia shares as of September 30.

Additionally, Thiel reduced his Tesla stake to 65,000 shares from 272,613 shares. He also completely exited his stake in Vistra Energy Corp (NYSE:VST), which was previously 208,747 shares.

Interestingly, Thiel significantly increased his holdings in two “Mag 7” stocks, buying 79,181 shares of Apple Inc. (NASDAQ:AAPL) and 49,000 shares of Microsoft Corporation (NASDAQ:MSFT).

Thiel’s move also follows SoftBank’s recent offloading of its Nvidia stake in October. The Japanese conglomerate fully exited its position in U.S. chipmaker Nvidia, selling all 32.1 million shares held by SBG and its asset-management arm for roughly $5.83 billion.

Interestingly, this occurred despite SoftBank CEO Masayoshi Son‘s assertion earlier this month that Nvidia was “undervalued.” Son dismissed talk of an AI bubble, insisting Nvidia remains undervalued and only a glimpse of the sector’s future scale. He outlined a massive vision for the AI economy, predicting that artificial superintelligence could require 400 gigawatts of data-center power and up to 200 million AI chips—about $9 trillion in cumulative investment. Son argued that even this level of spending is “reasonable,” and possibly “too small.”

Thiel’s decision to exit Nvidia comes as a surprise, given his previous endorsement of the company as a leader in the AI race. In August, Peter Thiel said the real focus in AI should be on Nvidia’s chip dominance rather than on model developers like Meta Platforms (NASDAQ:META), OpenAI, or xAI. He argued that Nvidia is capturing most of the industry’s profits while others lose money, thanks in part to a generational talent shift that left the semiconductor sector undervalued and underappreciated.

However, back in July 2024, Thiel had also expressed concerns about the concentration of AI profits in a single company. He noted that 80–85% of all profits in AI currently go to Nvidia, calling it a “very strange” dynamic because most of the money is being made in the hardware layer, a part of the industry Silicon Valley is no longer deeply familiar with.