Bill Ackman Builds Microsoft Stake
Billionaire hedge fund manager Bill Ackman, founder and CEO of Pershing Square Capital Management, disclosed Friday that his firm quietly accumulated a Microsoft position during the first quarter, CNBC reported. Ackman announced the move in a detailed post on X ahead of Pershing Square’s quarterly 13F filing.
A Rare Entry Point at Market Multiples
Ackman said the Microsoft stake was built starting in February. The entry point came after Microsoft shares tumbled following the company’s fiscal second-quarter earnings. His firm acquired shares at roughly 21 times forward earnings, a valuation broadly in line with the broader market and well below Microsoft’s own historical average. Ackman described the position as a core holding, though he stopped short of disclosing its dollar size.
Microsoft shares have dropped more than 26% from their record high set in July 2025. Concerns that aggressive AI spending will not generate adequate returns drove much of that decline.
Why Ackman Thinks the Market Got It Wrong
Ackman pushed back on the prevailing skepticism. He argued that investors have overestimated the competitive threat to Microsoft’s AI positioning and underestimated the resilience of Azure’s growth trajectory. He pointed to the M365 productivity suite as a deeply embedded enterprise platform, one he said is difficult to displace because of Microsoft’s layered security, compliance and identity infrastructure.
He also expressed confidence in CEO Satya Nadella‘s direct involvement in developing Copilot, Microsoft’s AI agent integrated across M365. Ackman wrote that those R&D efforts should translate into faster product development and broader customer adoption over time.
Alphabet Sale Helped Fund the Buy
In a follow-up post, Ackman clarified that Pershing Square partially funded the Microsoft purchase by selling its position in Alphabet, Google’s parent company. He was careful to frame the sale as a capital allocation decision rather than a bearish call. Ackman said Pershing Square remains constructive on Alphabet’s long-term outlook but prioritized Microsoft given valuation differences and the firm’s finite capital.
The disclosure echoes prior Pershing Square investments in Alphabet, Amazon and Meta, all of which Ackman said were initiated during periods of heightened market anxiety over AI competition and spending levels.
Pershing Square’s Broader Expansion
The Microsoft announcement follows a busy stretch for Ackman’s firm. Pershing Square last month completed dual initial public offerings, launching closed-end fund Pershing Square USA Ltd. under the ticker PSUS and the asset management business itself under the ticker PS. PSUS closed its most recent session at $41.68, below its $50 IPO price.
Read Next: What the Fed’s Pause Means for Equity Valuations in 2026
