Ackman’s Pershing Square Takes Core Microsoft Stake Amid AI Capex Selloff

Pershing Square Capital Management has taken a new core stake in Microsoft Corp., capitalizing on a stock pullback driven by Wall Street anxiety over massive artificial intelligence spending and slowing cloud growth.

Billionaire investor Bill Ackman disclosed the position in a post on social media platform X ahead of his firm’s quarterly 13F filing with the U.S. Securities and Exchange Commission. While Ackman did not reveal the precise size of the investment, he characterized it as a “core holding.”

Pershing Square began accumulating shares in February after Microsoft stock dropped approximately 10% following its second-quarter earnings report. The selloff was triggered by Azure cloud revenue growth coming in 1 percentage point below expectations alongside a sharp increase in capital expenditures.

“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 in the post.

Microsoft shares have fallen more than 15% year-to-date as investors evaluate whether revenue growth from Azure can justify the company’s accelerating infrastructure commitments. Sentiment was further impacted by a restructuring of its partnership with OpenAI, which stripped Microsoft of exclusive distribution rights.

Ackman framed the partnership restructuring as a positive shift toward a multi-model architecture designed to serve enterprise clients better. He also argued that equity markets fail to reflect Microsoft’s 27% economic interest in OpenAI, which he valued at roughly $200 billion based on the startup’s most recent funding valuation.

Addressing market concerns regarding Microsoft’s projected $190 billion capital expenditure budget for fiscal year 2026, Ackman described the outlay as a growth investment along a “J curve” rather than a risk to operating margins. He highlighted the enterprise retention of the Microsoft 365 productivity suite, calling it “deeply embedded” and “nearly impossible to replicate.”

The purchase follows a consistent strategy by Pershing Square of entering mega-cap technology stocks during periods of heightened market anxiety surrounding AI costs and execution.

“We acquired Alphabet when the stock declined substantially on the release of ChatGPT in late 2022, Amazon in the weeks following Liberation Day, and Meta more recently on the market’s response to the company’s unexpectedly large capex guidance,” Ackman wrote.