7.7 million shares all sold, Bill & Melinda Gates Foundation liquidates its Microsoft holdings.

Another well-known foundation has liquidated its holdings in Microsoft.

According to the latest documents from the U.S. Securities and Exchange Commission (SEC), the Gates Foundation Trust sold its remaining 7.7 million shares of Microsoft in the first quarter of 2026, cashing out about $3.2 billion. As a result, this fund—of which Bill Gates is the sole trustee and is managed by Cascade Asset Management—no longer holds any Microsoft shares.

Just one year ago, the trust still held 28.5 million shares of Microsoft, valued at about $10.7 billion and constituting 26% of the fund's total assets. It went from 28.5 million shares to zero in less than a year.

The news was first revealed by Barron’s on May 15. The Gates Foundation referred media inquiries to Cascade Asset Management, which declined to comment, and Microsoft also did not respond.

It is worth noting that Bill Gates himself still holds about 103 million shares of Microsoft, worth roughly $43 billion. His personal holdings remain unchanged. The liquidation is by the foundation, not Gates personally.

Why sell? Maybe it's not because of lack of confidence

On the surface, the charitable foundation of Microsoft’s co-founder liquidating its Microsoft holdings sounds like a major bearish signal. However, market analysts say the real logic is much milder.

There are three reasons:

First, concentration risk. The primary duty of a charitable foundation is to fund charitable projects, not to bet on a single stock. Even if the stock is from a company you founded, being overly concentrated is still risky.

Second, liquidity needs. The Gates Foundation needs to disburse tens of billions of dollars in charitable funds annually. Holding a single stock—even a high-quality one—does not efficiently meet the ongoing cash outflow needs.

Third, the foundation has a clear "termination date". Last year, Gates announced that the foundation would complete its mission and close within 20 years, at which point all assets would be used for charitable spending. This means the foundation is already in a systematic liquidation process, and selling Microsoft is part of this plan, not a sudden decision.

Analyses point out that this move is more like an investment portfolio manager making asset allocations, rather than a founder expressing pessimism about his company.

Microsoft stock is becoming a “battlefield” for top investors—some are selling out, others are buying in

During the same period the Gates Foundation liquidated its Microsoft holdings, Microsoft’s stock was undergoing a rare public showdown among top investors.

Sir Christopher Hohn, founder of the renowned UK hedge fund TCI, nearly liquidated all his Microsoft holdings, worth about $8 billion, reducing Microsoft from 10% of his portfolio to about 1%.

TCI had held Microsoft since Q4 2017, during which time Microsoft’s share price rose by close to 400%, with TCI benefiting greatly. This sell-off marks the substantive end of a nearly ten-year investment relationship.

In a letter to investors, Hohn clearly expressed concern: the rapid evolution of AI may create a new generation of productivity platforms, threatening the long-standing market dominance of Microsoft Office; at the same time, he saw "a certain degree of risk" in Azure’s growth prospects.

While reducing Microsoft, TCI increased its holding in Google parent Alphabet from 3% to 5%, making it the fund’s largest tech holding. This portfolio shift clearly reveals TCI's judgment: within the tech sector, shifting from Microsoft to Google.

In direct contrast to Hohn’s direction, Bill Ackman of U.S. hedge fund Pershing Square announced a newly established Microsoft core position worth about $2.4 billion, disclosed in 13F filings.

Ackman responded directly to Hohn on the X platform, saying he was “wrong.”

His investment logic centers on three points:

First, M365’s moat is “almost impossible to replicate.” The suite currently has 450 million+ active users, and Word, Excel, PowerPoint, Outlook, and Teams are deeply embedded in nearly all large enterprises’ daily workflows. He also cited bundling price advantages: M365 charges about $20 per user per month, less than half the cost of separately procuring similar tools.

Second, Azure’s strong growth, concerns are “misplaced.” Ackman cited Azure’s 39% constant-currency revenue growth last quarter and noted that Microsoft raised its 2026 annual capex budget to about $190 billion, with roughly two-thirds directly tied to recent revenues.

Third, undervalued valuation. Ackman pointed out that Microsoft holds about 27% of OpenAI’s economic interest, which, based on OpenAI’s latest fundraising round valuation, equates to about $200 billion—7% of Microsoft’s market cap—but is not yet reflected in its ~21 times forward P/E ratio, which is in line with the broad market and far below Microsoft’s historical average.

On negative market interpretation of Microsoft abandoning exclusive sales rights to OpenAI models, Ackman argued differently: it is not a concession to OpenAI but a proactive shift towards a more open multi-model architecture, which better serves enterprise clients needing flexible cross-model deployment. He cited data that over 10,000 enterprise customers are using more than one model on Azure Foundry.

Is AI a “threat” or an “engine” for Microsoft?

According to Wallstreetcn, the fundamental disagreement between Hohn and Ackman lies in starkly different views on the relationship between AI and the existing software ecosystem.

Hohn holds a “disruptive” position: AI will create brand new productivity gateways, thereby eroding Microsoft Office’s decades-old user moat.

Ackman holds a “strengthening” position: AI will be integrated as incremental features into existing platforms; Microsoft, through Copilot’s deep integration and Azure’s shift to a multi-model architecture, will become one of the biggest enterprise beneficiaries of the AI wave.

This public game has had a direct market impact. According to Wallstreetcn, in the week of May 16, Microsoft rose 3.05% while Alphabet A, which Ackman simultaneously signaled reducing, fell 1.07%.

However, Microsoft’s share price is still down more than 15% year-to-date, and doubts about its ability to turn huge AI investments into business returns persist.

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