Pershing Square Capital Management (PSCM), a roughly $15.5 billion fund run by the billionaire Bill Ackman, typically carries only 10 to 12 stocks at any given time.
Four of them are now “Magnificent Seven” stocks.
While the fund’s 13F filings disclosing the company’s holdings at the end of the first quarter of 2026 won’t be released until later today (May 15), Ackman on X disclosed that PSCM, the investment manager of Pershing Square Holdings, has taken a new stake in Microsoft (MSFT +2.60%).
Ackman also said that his new closed-end fund, Pershing Square USA, has also made Microsoft a core holding.
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Ackman and his team at PSCM have been piling into the “Magnificent Seven” since last year. At the end of 2025, Amazon, Alphabet, and Meta Platforms comprised 39.4% of the portfolio.
On X, Ackman wrote that PSCM has identified recent opportunities to acquire “Magnificent Seven” stocks due to two big factors: rising index ownership and larger allocations of capital by leveraged, short-term investors who do not tolerate volatility well.
“For example, we acquired Alphabet $GOOG when the stock declined substantially on the release of ChatGPT in late 2022, Amazon $AMZN in the weeks following Liberation Day, and $META more recently on the market’s response to the company’s unexpectedly large capex guidance and expenditures,” he wrote.
Should investors follow Ackman’s move and buy Microsoft stock?
The case for Microsoft
In the first three months of the year, Microsoft’s stock had its worst quarter since 2008, declining by 23%. While the stock has rebounded some, it’s still down about 13.5% this year.
On X, Ackman said PSCM began accumulating Microsoft shares in February and ultimately built a position when the company traded at 21 times forward earnings, which, at the time, was in line with the broader market multiple and well below Microsoft’s average multiple in recent years.
MSFT PE Ratio data by YCharts
Ackman and his team are bullish on Microsoft because of its 365 and Azure franchises, which account for roughly 70% of the company’s earnings. Microsoft 365, which includes office products like Word, Excel, and PowerPoint, that power the business world, has over 450 million subscribers.
This suite of office tools also integrates Microsoft’s digital artificial intelligence assistance Copilot, which had 20 million paid seats at the end of its most recent quarter.
Meanwhile, Azure is one of the largest cloud platforms that, according to Ackman, “is a direct beneficiary of the multi-decade migration of enterprise IT workloads to the cloud, which is now further accelerated by surging demand for AI inference workloads.”
Ackman also said that he and his team believe investors are missing a few other aspects of the Microsoft story. For instance, Microsoft owns a 27% economic interest in OpenAI, the parent company of ChatGPT, which would be worth $200 billion, or roughly 7% of Microsoft’s total market cap.
Ackman also believes investor concerns about AI alternatives eroding Microsoft 365’s market share are overblown, and he and his team are encouraged to see CEO Satya Nadella taking a more active role in Copilot’s development.
Should investors follow Ackman into Microsoft?
While I do have many concerns about AI and whether this massive, multi-year run can continue without running into roadblocks first, I do agree with Ackman that Microsoft is a good long-term buy.
I’m not sure Copilot can ever compete with the likes of ChatGPT or Anthropic’s Claude, but the company will benefit from the AI revolution, notably in its Azure and cloud business.
I also view the Microsoft 365 suite of office tools, along with the Copilot integration, as a resilient business that can maintain its market share. Microsoft is an incredibly trusted brand in the enterprise world, and it will not be easy to dislodge.
Regardless of what happens with AI, I see Microsoft as a sustained winner in the tech world.