Key Takeaways:
Bill Ackman’s Pershing Square Capital Management sold 95% of its stake in Alphabet Inc. (GOOGL) in the first quarter of 2026, redirecting the capital into a new position in Microsoft Corp. (MSFT).
In a post on social media platform X, Ackman explained the sale was not a bearish call on Alphabet but a demonstration of prudent portfolio management. After a strong run-up, he said Alphabet no longer offered the same margin of safety and he saw a superior setup in Microsoft.
The move concludes a highly profitable trade that began in early 2023 when Pershing Square acquired Alphabet shares at between $90 and $100. The firm’s new position in Microsoft consists of roughly 5.6 million shares, acquired after the stock dropped following its fiscal second-quarter results, when it traded at forward price-to-earnings multiples between 20 and 23.
Ackman’s rotation shows him capitalizing on Alphabet’s AI-driven rally and then redeploying funds into Microsoft after its stock fell over 18% on concerns about a slowdown in Azure growth and rising capital expenditures. The sell-off provided what Ackman viewed as a rare discount on a premier technology franchise.
The decision to buy Microsoft was based on the market’s overly pessimistic reaction to the company’s spending plans for AI infrastructure. Ackman’s post highlighted Microsoft’s durable position with its Microsoft 365 and Azure businesses, its stake in OpenAI, and the growth potential from its Copilot AI tools. Pershing Square viewed the dip as an opportunity to invest in a blue-chip company with durable competitive advantages at a normalized valuation.
Filings also revealed Pershing Square increased its stake in e-commerce and cloud giant Amazon.com, Inc. (AMZN) by 19% during the same quarter, making it the fund's second-largest holding. This further signals a broad conviction on the long-term growth of cloud computing and artificial intelligence leaders.
The portfolio shift highlights the intense competition for investment capital between the world’s largest technology companies as they race to monetize AI. Investors will be watching Pershing Square's next 13F filing in three months for any further adjustments to these core positions.
This article is for informational purposes only and does not constitute investment advice.
