Key Takeaways
- • Alphabet exit: Bill Ackman's Pershing Square sold its entire stake in Alphabet (GOOGL/GOOG) during Q4 2025, exiting a position in a mega-cap stock that had appreciated approximately 100% over an 18-month period.
- • Netflix entry: Ackman initiated a new position in Netflix (NFLX) by purchasing over 3 million shares at an average price of roughly $38.40 per share, representing approximately $1.1 billion in capital deployed into a stock trading 42% below its record high.
- • Contrarian valuation thesis: The trades reflect Ackman's stated investment philosophy of acquiring growth-oriented companies when they fall out of favor with broader investor sentiment, positioning for mean reversion and fundamental reassessment.
- • Netflix operational backdrop: The Netflix position entry occurs amid the company's subscriber base decline and business model modifications, yet Ackman's public commentary suggests he views the current valuation as attractive relative to long-term value creation potential.
- • Alphabet fundamentals intact: At the time of sale, Alphabet reported strong Q2 financial performance with 24% revenue growth to $120 billion, 31% operating income growth to $41 billion, and accelerating Google Cloud revenue (+82%) driven by AI infrastructure demand.
Summary
Bill Ackman's Pershing Square Capital Management executed two significant portfolio adjustments in the second quarter of 2026, selling a multi-billion-dollar position in Alphabet while simultaneously deploying approximately $1.1 billion into Netflix. The Alphabet exit represents a liquidation of holdings in a mega-cap technology company that had nearly doubled in value over the preceding 18 months, driven primarily by strong artificial intelligence sentiment and solid operational performance.
Ackman's decision to exit Alphabet came despite the company posting robust financial results, with Q2 revenue reaching $120 billion (up 24% year-over-year) and GAAP operating income climbing 31% to $41 billion. Google Cloud, increasingly central to Alphabet's growth narrative, accelerated 82% in the quarter, marking the fifth consecutive quarter of acceleration fueled by enterprise demand for AI infrastructure services. From a pure operational standpoint, Alphabet demonstrated the financial strength that had driven its prior appreciation.
Conversely, Ackman deployed capital into Netflix at significantly depressed valuations, purchasing over 3 million shares at approximately $38.40 per share during a period when the streaming platform traded 42% below its all-time high. This entry point reflects Netflix's recent operational challenges, including subscriber base declines and ongoing business model adjustments, yet Ackman's public positioning suggests he views the current market repricing as excessive relative to Netflix's long-term cash generation capacity.
The paired trades exemplify Ackman's documented investment methodology: rotating out of consensus mega-cap winners trading at elevated valuations and into high-quality companies experiencing temporary investor disfavor. By his public commentary, current market volatility presents compelling entry points for patient capital willing to tolerate near-term headwinds in exchange for fundamental value realization. The Netflix position, announced publicly during television appearances, signals conviction in the thesis and potential signaling value to other sophisticated investors monitoring his portfolio positioning.
Ackman's decision to exit Alphabet came despite the company posting robust financial results, with Q2 revenue reaching $120 billion (up 24% year-over-year) and GAAP operating income climbing 31% to $41 billion. Google Cloud, increasingly central to Alphabet's growth narrative, accelerated 82% in the quarter, marking the fifth consecutive quarter of acceleration fueled by enterprise demand for AI infrastructure services. From a pure operational standpoint, Alphabet demonstrated the financial strength that had driven its prior appreciation.
Conversely, Ackman deployed capital into Netflix at significantly depressed valuations, purchasing over 3 million shares at approximately $38.40 per share during a period when the streaming platform traded 42% below its all-time high. This entry point reflects Netflix's recent operational challenges, including subscriber base declines and ongoing business model adjustments, yet Ackman's public positioning suggests he views the current market repricing as excessive relative to Netflix's long-term cash generation capacity.
The paired trades exemplify Ackman's documented investment methodology: rotating out of consensus mega-cap winners trading at elevated valuations and into high-quality companies experiencing temporary investor disfavor. By his public commentary, current market volatility presents compelling entry points for patient capital willing to tolerate near-term headwinds in exchange for fundamental value realization. The Netflix position, announced publicly during television appearances, signals conviction in the thesis and potential signaling value to other sophisticated investors monitoring his portfolio positioning.
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