Bill Ackman sold all Alphabet shares in April while Greg Abel added to Berkshire Hathaway's position, which became the company's fifth-largest holding.

Ackman completed selling Pershing Square's Alphabet shares in April; Abel was simultaneously adding to Berkshire Hathaway's position, making Alphabet its fifth-largest position. Ackman used the proceeds to establish a new position in Microsoft last quarter.

Alphabet operates across three layers of the AI value chain: Google Cloud rents compute capacity and sells AI accelerator chips (including its own Tensor Processing Units and central processing units); it develops the Gemini family of models; and it has integrated generative AI into Search, Chrome, and its ad platform. Google Cloud revenue growth accelerated to 63% last quarter with operating margin expanding to 33%.

Ackman likely sees better value elsewhere at Alphabet's current valuation of 27 times forward earnings expectations, whereas Microsoft trades at approximately 25 times forward earnings. Management expects to spend up to $190 billion this year on capital expenditures.