Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below.<\/p>\n
The Gates Foundation Trust, founded by Bill Gates and Melinda French Gates, recently disclosed that it sold its final 7.7 million shares of Microsoft during the first quarter of 2026 \u2014 a roughly $3.2 billion exit that ends a decades-long position in the company Gates cofounded (1).<\/p>\n
A very different story had already broken on the morning of the disclosure. Hours before the Gates filing hit the SEC on May 15, Bill Ackman, founder and CEO of Pershing Square Capital Management, used a lengthy X post to announce a brand-new Microsoft position (2). Pershing\u2019s 13F filing, filed later that evening, showed roughly 5.65 million shares, worth around $2.09 billion, on the books at quarter-end (3).<\/p>\n
Top Picks <\/p>\n
The following morning, Ackman explained he used Pershing\u2019s holdings of Alphabet, the parent company of Google, to pay for it. \u201cTo be clear, our sale of $GOOG was not a bet against the company,\u201d he wrote on X (4). \u201cWe are very bullish long term on Alphabet. But at current valuations and in light of our finite capital base, we used $GOOG as a source of funds for $MSFT.\u201d<\/p>\n
Why is Gates selling? <\/p>\n
The 7.7 million-share sale is the final tranche of a multi-year sale by the Gates Foundation Trust. The trust held roughly 28.5 million Microsoft shares at the end of the first quarter of 2025, trimmed to 7.7 million by year-end and zeroed out this quarter.<\/p>\n
This comes after Gates announced in May 2025 that the foundation will sunset operations in 2045 and spend roughly $200 billion on charitable work over the next 20 years (5).<\/p>\n
\u201cThere are too many urgent problems to solve for me to hold onto resources that could be used to help people,\u201d he wrote. \u201cThat is why I have decided to give my money back to society much faster than I had originally planned.\u201d<\/p>\n
A foundation winding down its endowment doesn\u2019t have a choice but to sell \u2014 it has to fund the giveaway.<\/p>\n
Read More: Here\u2019s the average income of Americans by age in 2026. Are you falling behind?<\/a><\/p>\n Why is Ackman bullish on Microsoft? <\/p>\n Pershing started stockpiling Microsoft in February, right after the company’s fiscal Q2 2026 earnings sent the stock tumbling (2). It kept buying through a stretch where Microsoft was down sharply on the year and well off its July 2025 record high.<\/p>\n Two worries had spooked the market.<\/p>\n First, Copilot adoption. Microsoft has converted only about 15 million of its 450 million paid Microsoft 365 commercial seats into paying Copilot users. Independent research showed Copilot\u2019s market share fell from 18.8% in July 2025 to 11.5% by January 2026 (6). That decline prompted CEO Satya Nadella to reorganize the AI division in March and sideline the AI executive he paid $650 million to recruit (7).<\/p>\n Second, the AI capex bill. Microsoft is spending $190 billion on capital expenditure in 2026. Some investors think the math doesn\u2019t work.<\/p>\n Ackman thinks they\u2019re wrong on the capex part. Azure revenue grew 39% in constant currency last quarter. Microsoft\u2019s AI business hit a $37 billion annualized run rate, up 123% year-over-year (8). Ackman called the $190 billion \u201cgrowth capex that should drive future revenue generation\u201d rather than a margin threat (2).<\/p>\n He also thinks the market is undervaluing the core franchise. Microsoft 365 and Azure together throw off roughly 70% of Microsoft\u2019s overall profits. M365 monthly ARPU sits around $20 \u2014 less than half what customers would pay for the underlying applications individually. Investors, he wrote, \u201cunderestimate the resilience of the M365 franchise given its deeply embedded role across enterprises and highly attractive price-value proposition (2).\u201d<\/p>\n Then there\u2019s the OpenAI stake. Microsoft owns roughly 27% of OpenAI economically. At the most recent funding round, that\u2019s about $200 billion \u2014 or 7% of Microsoft\u2019s market cap. Ackman says the share price doesn\u2019t reflect any of that.<\/p>\n Pershing got in at roughly 21 times forward earnings. Ackman called that \u201cbroadly in line with the market multiple and well below Microsoft\u2019s trading average over the last few years.\u201d<\/p>\n The takeaway for investors: Not a rebalance <\/p>\n The Google side of the rotation is where the conviction shows.<\/p>\n Pershing held more than 6.1 million Alphabet Inc. Class C shares at the end of 2025. By the close of the first quarter of 2026, that was down to about 312,000, or a 95% cut, worth roughly $1.64 billion at quarter-end pricing. Class A holdings fell from around 678,000 shares to 32,000 over the same stretch. The remaining position was fully liquidated in the second quarter, according to a person familiar with the portfolio, as cited by Reuters (9).<\/p>\n Pershing had owned Google for three years at an average cost of about $94 a share. Class C was near $392 the Friday the 13F dropped. That\u2019s roughly four times Ackman\u2019s cost basis.<\/p>\n He rolled the proceeds straight into Microsoft, then went on X the following morning to make it clear that the sale wasn\u2019t a call on Google\u2019s prospects.<\/p>\n To summarize, Ackman zeroed out a three-year, multibillion-dollar Google position, picked up Microsoft at 21x forward earnings and bet that the market has mispriced the enterprise franchise against its AI uncertainty. The Gates sale, while being reported on social media like a bear signal, is its own thing \u2014 a foundation funding $200 billion in giveaways. Selling Microsoft because of that would be misguided.<\/p>\n Ackman\u2019s trade is the one with a thesis behind it: Copilot\u2019s paid base is running at about 3% of its addressable seats. That gap is what he\u2019s buying.<\/p>\n Expert advice at your fingertips <\/p>\n Bill Ackman has spent nearly 34 years navigating the market\u2019s ups and downs. He cofounded his first investment firm, Gotham Partners, back in 1992 before founding Pershing Square Capital Management in 2004 with just $54 million. Today, Pershing oversees billions in assets (10).<\/p>\n But it\u2019s important to remember that Ackman isn\u2019t making these calls alone from a laptop at home. Billion-dollar hedge funds operate with teams of analysts and industry experts who have access to institutional-grade research and sophisticated market data.<\/p>\n Everyday investors often don\u2019t have access to that same level of research \u2014 or the ability to absorb losses if a trade goes wrong. That\u2019s why following billionaire investors can be risky.<\/p>\n For investors who want exposure to the market but aren\u2019t confident picking individual winners, platforms like Moby<\/a> can help. Their platform offers expert research and recommendations to help you identify strong, long-term investments backed by advice from former hedge fund analysts.<\/p>\n In four years, and across almost 400 stock picks, their recommendations have beaten the S&P 500 by almost 12% on average. They also offer a 30-day money-back guarantee.<\/p>\n Moby\u2019s team spends hundreds of hours sifting through financial news and data to provide you with stock and crypto reports delivered straight to you<\/a>. Their research keeps you up-to-the-minute on market shifts and can help you reduce the guesswork behind choosing stocks and ETFs.<\/p>\n Plus, their reports are easy to understand for beginners, so you can become a smarter investor in just five minutes<\/a>.<\/p>\n Keep trading costs low <\/p>\n At the same time, keeping investing costs low can be just as important as choosing the right stocks. High fees, trading commissions and unnecessary account costs can quietly eat away at long-term gains over time.<\/p>\n Using a discount broker with low or zero commissions on trades can help investors preserve more of their returns. Lower investing costs mean more of your money stays in the market, compounding over the long run instead of being chipped away by fees every time you make a move. Even saving a small percentage annually can add up to thousands of dollars over decades of investing.<\/p>\n SoFi\u2019s easy-to-use DIY investing platform lets you[ buy stocks, ETFs and more](https:\/\/moneywise.com\/c\/1\/236\/1718?placement=4<\/a>) with no commission fees and no account minimums.<\/p>\n SoFi is designed for both beginners and seasoned investors, with real-time investing news, curated content and the data you need to make smart decisions about the stocks that matter most to you.<\/p>\n Plus, for a limited time you can get up to $1,000 in stock<\/a> when you fund a new account.<\/p>\n Consult a financial advisor <\/p>\n For investors managing larger portfolios, professional guidance can play an essential role in protecting and growing wealth. Those with portfolios of $250,000 or more may in particular benefit from working with a financial advisor to help avoid costly mistakes and build a plan aligned with long-term goals like retirement.<\/p>\n So, if you have a portfolio of $250,000 or more, platforms like WiserAdvisor<\/a> can connect you with vetted professionals who specialize in this kind of planning.<\/p>\n Simply answer a few questions about your savings, retirement timeline and overall investment portfolio.<\/p>\n From there, WiserAdvisor reviews its network to match you \u2014 for free \u2014 with up to three vetted, reputable advisors aligned with your specific needs.<\/p>\n You can then schedule no-obligation consultations<\/a> with your matches to determine who is the best fit for your long-term goals.<\/p>\n WiserAdvisor is a matching service and does not provide financial advice directly. All matched advisors are third parties, and specific financial results are not guaranteed.<\/p>\n \u2014 With files from Rudro Chakrabarti<\/p>\n You May Also Like <\/p>\n Join 250,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/p>\n Article sources <\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines<\/a>.<\/p>\n Securities and Exchange Commission (1)<\/a>,(3)<\/a>; @BillAckman (2)<\/a>,(4)<\/a>; Gates Foundation (5)<\/a>; Recon Analytics (6)<\/a>; Microsoft (7)<\/a>,(8)<\/a>; Reuters (9)<\/a>; Forbes (10)<\/a><\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. The Gates…\n","protected":false},"author":2,"featured_media":457648,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[65937,31184,114,1125,59739,133,85,46,27317,134,29830,149225],"class_list":["post-457647","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-bill-ackman","tag-bill-gates","tag-business","tag-dave-ramsey","tag-gates-foundation","tag-google","tag-il","tag-israel","tag-melinda-french-gates","tag-microsoft","tag-microsoft-365","tag-pershing-square-capital-management"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/457647","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=457647"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/457647\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/457648"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=457647"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=457647"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=457647"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}