Bill Ackman Says Alphabet Stake Sale Wasn't a Bet Against Google — Then Reveals Bullish Microsoft Bet

Billionaire hedge fund manager Bill Ackman has dumped his entire stake in Alphabet to bankroll a £1.58 billion ($2.09 billion) bet on Microsoft, calling the software giant's current price tag one of the most attractive entry points in a decade.

Ackman disclosed the move in a post on X on 15 May ahead of Pershing Square's quarterly 13F filing with the US Securities and Exchange Commission. His firm began accumulating Microsoft shares in February after the company's fiscal second-quarter results spooked Wall Street with slower cloud computing growth and a sharp ramp-up in capital spending.

'We were able to establish our position at a valuation of 21 times forward earnings, broadly in line with the market multiple and well below Microsoft's trading average over the last few years,' Ackman wrote.

Pershing Square's 13F filing showed ownership of roughly 5.65 million Microsoft shares at the end of the first quarter. That position had climbed to approximately £1.74 billion ($2.3 billion) by market close on 15 May, CNBC confirmed. Microsoft shares have fallen more than 15 per cent this year and over 26 per cent from their record high in July 2025.

Ackman Calls Alphabet Sale a Funding Move, Not a Bearish Bet

A day after revealing the Microsoft stake, Ackman moved to contain the fallout from the Alphabet exit. In a follow-up post on X on 16 May, he insisted the sale should not be read as a bearish signal.

'To be clear, our sale of Google was not a bet against the company. We are very bullish long term on Alphabet. But at current valuations and in light of our finite capital base, we used Google as a source of funds for Microsoft,' he wrote.

Pershing Square first bought into Alphabet in 2022 after the release of ChatGPT battered the stock on fears that AI would upend Google's search dominance. A person familiar with the portfolio told Reuters that Ackman has now fully liquidated the Alphabet position, with the last shares sold in the second quarter of 2026.

Why Ackman Is Betting Big on Microsoft's AI and Cloud Play

Ackman's investment thesis centres on two pillars: Microsoft's Azure cloud-computing division and its M365 Office productivity suite, which bundles the Copilot AI assistant at £23 ($30) a month per user. He argued that the market has become overly worried about competitive threats from Google and Amazon in the AI race and that concerns around Microsoft's loosened exclusivity deal with OpenAI are overblown.

'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,' he wrote. He also pointed to Microsoft's 27 per cent stake in OpenAI, which he valued at roughly £151 billion ($200 billion) - approximately 7 per cent of Microsoft's total market capitalisation.

Ackman backed the £143.6 billion ($190 billion) capital spending plan Microsoft laid out for 2026, calling it essential to fuelling future revenue growth. Microsoft's most recent quarter showed revenue of £62.6 billion ($82.89 billion), an 18 per cent jump year on year, while Azure grew 40 per cent and the company's AI business hit an annualised run rate of £28 billion ($37 billion), up 123 per cent from the prior year.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said Ackman's entry validates a view already circulating among institutional investors.

'Shares are trading at one of the lowest levels seen in the past decade. We do not think that's justified,' Britzman told Reuters.

The Microsoft stake is part of a broader pattern for Pershing Square. Ackman compared the trade to his earlier purchases of Amazon, which he scooped up after last year's Liberation Day tariff shock, and Meta, which he bought after the company's aggressive spending forecast rattled investors. Each time, he moved in when the market flinched.

The disclosure came weeks after Pershing Square's twin stock market debuts. Its closed-end fund, Pershing Square USA, began trading under the ticker PSUS, while the asset management arm is listed as PS. Ackman confirmed that PSUS has also taken Microsoft on as a core holding but will not file a separate disclosure. PSUS last traded at £31.50 ($41.68), below its £37.80 ($50) IPO price.

Microsoft shares rose more than 3 per cent in early trading on 15 May following the announcement.