Ackman's $4.4B Bet on Microsoft and Amazon Starts to Pay Off

Billionaire hedge fund manager Bill Ackman has invested $4.4 billion in Microsoft and Amazon, making them more than one-fifth of Pershing Square Capital Management's U.S. stock portfolio.

Ackman added nearly 10% to his Microsoft stake in the second quarter, while cutting his Amazon position by about a quarter.

Ackman initially started buying Microsoft in February after its stock dropped 10% on weaker-than-expected cloud growth numbers.

He argued that investors had misread Microsoft's $190 billion capital spending plan as a threat to margins, when it was actually an investment in growth.

Ackman also pointed out that Microsoft has a significant economic stake in OpenAI, worth around $200 billion at the startup's most recent funding valuation.