Ackman’s Pershing Square Grabs Microsoft Stake as Stocks Slide
Billionaire investor Bill Ackman established a new position in tech giant Microsoft following a recent decline in its stock price, while divesting his long-held investment in Google parent Alphabet to finance this acquisition. In a post on social media platform X, Ackman indicated that the investments will be outlined in a regulatory filing that his firm Pershing Square intends to submit later on Friday to the U.S. Securities and Exchange Commission. The filing will indicate that Pershing Square held a portion of Alphabet shares at the conclusion of the first quarter; however, a source acquainted with the portfolio revealed that Ackman has since divested entirely from Alphabet, liquidating the position in the second quarter. Ackman contended that Microsoft is positioned at a “highly compelling valuation” following a recent downturn in its stock price.
Ackman stated that the Microsoft investment represents the most recent move in a sequence of capital allocations towards technology firms that exhibit appealing valuations and the capacity for significant long-term expansion. He stated that Microsoft manages two of the most valuable enterprise technology sectors – its Azure cloud division and the M365 Office productivity suite, which features its $30-a-month Copilot AI assistant, positioning the company at the forefront of increasing AI adoption among businesses. According to Ackman, Pershing Square initiated its investment in Microsoft in February, following a decline in the technology firm’s stock price, which was attributed to its quarterly earnings report indicating a deceleration in cloud revenue growth alongside an increase in expenditures. Meanwhile, he divested his holdings in Alphabet, which he had acquired three years prior at an average price of $94 per share. On Friday, Alphabet’s Class C stock was priced at $392.
The shares of the Windows maker have declined approximately 15% this year, as investors express concerns regarding the sluggish adoption of Copilot and modifications to the OpenAI partnership that remove Microsoft’s exclusive rights to resell the startup’s technology on its cloud platform. The recent declines in stock values can be attributed to the significant advancements made by competitors Google and Amazon in their respective AI initiatives. Ackman stated that the concerns were exaggerated. “We view Microsoft’s recent decision to restructure its OpenAI partnership not as a concession but as part of a deliberate pivot toward a more open, multi-model architecture that better serves enterprise customers,” Ackman said. He also endorsed Microsoft’s $190 billion spending plan for 2026, asserting that it is crucial for driving future revenue growth.
Ackman’s newly established closed-end fund, Pershing Square USA, has designated Microsoft as a core holding; however, he indicated that no filing will be forthcoming. Microsoft’s shares experienced an increase of over 3% during the initial trading session. Ackman’s stake aligns with our view that Microsoft has scope to re-rate from current levels,” stated Matt Britzman. Equities are currently positioned at some of the most depressed valuations observed over the last ten years. We do not believe that is warranted. It also acquired Amazon in the weeks following U.S. President Donald Trump’s imposition of tariffs on numerous countries, and Meta more recently after the company unsettled investors with a substantial spending forecast.
