This article first appeared on GuruFocus.
Microsoft (MSFT, Financials) shares slipped after reports that hedge fund TCI sharply reduced its position in the technology giant due to concerns about the long-term impact of artificial intelligence on its business.
According to the Financial Times, TCI sold nearly all of its roughly $8 billion Microsoft stake. The fund reportedly said rapid AI advances could disrupt Microsoft’s Office productivity software and create risks for its Azure cloud platform.
TCI reduced Microsoft from about 10% of its portfolio at the end of 2025 to less than 1% by the end of March, the report said. At the same time, the hedge fund increased its position in Alphabet (GOOGL, Financials) to roughly 5% of its portfolio, making Google its largest technology investment.
For investors, the move reflects growing debate over which major technology companies are best positioned to benefit from the next phase of AI adoption. While Microsoft remains a leading AI player through its OpenAI partnership and cloud infrastructure business, some investors are increasingly questioning how AI could reshape traditional software markets.
