In this article, we will look at the 10 AI Bubble Stocks to Short Now According to Reddit.
According to a June 2 report by CNBC, Rick Rieder, BlackRock’s chief investment officer, remains relaxed, despite many investors raising concerns of an AI Bubble. Rieder oversees more than $2.4 trillion in assets. He told CNBC that the current market is extraordinary with momentum unlike anything he has seen before. While he acknowledges the uncertainty, he advises investors to stay invested in the market.
Rieder’s bullish sentiment is based on strong earnings. He noted that tech and semiconductor stocks actually have lower price-to-earnings ratios today than last October, while forward earnings growth has climbed above 20%. He added that for Mag 7 companies, the blended earnings growth is at around 27.6%, which makes the current multiples “not as scary” to buy. Rieder added that a large sum of capital remains on the sidelines, buyback activity is robust, and higher-yield portfolios generating 6% to 7% returns are compounding in ways that keep drawing investors back into equities. He highlighted that his firm is closely monitoring the concerns regarding return on invested capital for AI infrastructure. Rieder distinguished the AI market from the dotcom bubble, noting that today’s big spenders have solid cash flows, which backs the capital raises compared to the dotcom era.
With that, let’s take a look at the 10 AI Bubble Stocks to Short Now According to Reddit.
Our Methodology
To curate the list of 10 AI Bubble Stocks to Short Now According to Reddit, we used various Reddit threads that talked about AI stocks to Short. We cross-checked the short float values for the most mentioned stocks from Yahoo Finance and ranked the stocks in ascending order of the number of hedge fund holders sourced from Insider Monkey’s database. We have limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
10 AI Bubble Stocks to Short Now According to Reddit
10. SoundHound AI, Inc. (NASDAQ:SOUN)
Number of Hedge Fund Holders: 14
SoundHound AI, Inc. (NASDAQ:SOUN) is one of the AI Bubble Stocks to Short Now According to Reddit. SoundHound AI, Inc. (NASDAQ:SOUN) is among some of the most shorted stocks with a short float exceeding 38%. The stock has declined more than 16% since the release of fiscal Q1 2026 earnings on May 7. However, the Street continues to see significant upside, as 8 out of 10 analysts covering the stock have a Buy rating and the 12-month average price target reflects more than 67% upside from current levels.
During the fiscal first quarter of 2026, the company posted $44.2 million in revenue, reflecting a 52% year-over-year increase, and topped Wall Street’s expectation of $42.56 million. The EPS of negative $0.06 also fell short of the negative $0.03 consensus. Management noted the quarter to be strong, as excluding acquisitions, core automotive and IoT AI revenue surged 88%, reflecting organic demand across its key verticals.
However, the profitability remained weak as SoundHound posted a GAAP net loss of $25 million and an adjusted EBITDA loss of $26.7 million. Gross margins were also impacted by one-time vendor charges during the quarter, although management flagged these as non-recurring.
After the quarter, the company agreed to acquire LivePerson, with the combined company expected to create one of the most comprehensive enterprise AI footprints in conversational AI, serving 25 of the Fortune 100. Management sees a $500 million revenue opportunity and is targeting 2027 revenue of at least $350 million to $400 million.
SoundHound AI, Inc. (NASDAQ:SOUN) provides voice and conversational AI technology for automotive, restaurants, smart devices, customer service, healthcare, retail, financial services, and other enterprise markets.
9. Wolfspeed, Inc. (NYSE:WOLF)
Number of Hedge Fund Holders: 31
Wolfspeed, Inc. (NYSE:WOLF) is one of the AI Bubble Stocks to Short Now According to Reddit. On June 1, Wolfspeed, Inc. (NYSE:WOLF) announced an expansion in the data center market with a dedicated data center solutions team and a new regional office in the San Francisco Bay Area.
Management noted that this move is to take the company closer to hyperscalers and ODMs building next-generation AI infrastructure. Wolfspeed is one of the leaders in silicon carbide technology and noted high-voltage silicon carbide power solutions to be the core opportunity. Management highlighted that as AI computing scales dramatically, traditional data center power architecture needs to be fundamentally redesigned around higher voltages to minimize energy loss and maximize efficiency.
To lead the new data center solutions team, the company has hired two experienced executives, including Ganesh Srinivasan and Yogesh Ramadass. Ganesh Srinivasan joins as Senior Vice President, and Yogesh Ramadass as Vice President and Fellow.
The company has recently emerged from Chapter 11 after a major debt restructuring.
Wolfspeed, Inc. (NYSE:WOLF) makes advanced semiconductors using silicon carbide and gallium nitride materials, primarily for power applications.
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