The month of August has been chock-full of important data releases. The inflation and jobs report from the federal government, Federal Reserve Chair Jerome Powell's highly anticipated speech at Jackson Hole, and earnings releases from many of Wall Street's most influential businesses have deluged investors with information. It's also made it easy for something of importance to slip through the cracks.
For instance, Aug. 14 marked the deadline for institutional investors with at least $100 million in assets under management (AUM) to file Form 13F with U.S. regulators. A 13F offers a concise snapshot of which stocks Wall Street's shrewdest money managers bought and sold in the latest quarter (in this case, the quarter ended June 30).
Image source: Getty Images.
Although billionaire Warren Buffett has earned quite the following on Wall Street, he's not the only billionaire fund manager with a keen eye for value. Duquesne Family Office's billionaire boss Stanley Druckenmiller is also known for his outsize returns and ability to snag amazing deals.
What's particularly interesting about Druckenmiller has been his trading activity within the artificial intelligence (AI) space. Over the previous year, based on 13F filings covering trading activity from July 1, 2024 to June 30, 2025, Duquesne's investment guru sent Wall Street's two top-tier AI stocks, Nvidia (NVDA 1.10%) and Palantir Technologies (PLTR -0.98%), to the chopping block. But at the same time, he purchased shares of an essential AI titan for four consecutive quarters and made it a top-five holding.
Nvidia and Palantir were shown the door by billionaire Stanley Druckenmiller
As of the midpoint of 2024, Duquesne's billionaire chief was overseeing $2.9 billion in AUM spread across 64 holdings. This included 214,060 shares of Nvidia, following its 10-for-1 forward split in June 2024, as well as 769,965 shares of Palantir. By March 31, 2025, both of these holdings were completely exited.
The logical explanation for selling two of the hottest AI stocks on the planet is that Druckenmiller was locking in gains. The average stock for Duquesne Family Office has been held for less than seven months, which suggests its billionaire investor isn't afraid to cash in his fund's chips when the opportunity presents itself.
Shares of Nvidia have catapulted higher by roughly 1,120% since the end of 2022, as of the closing bell on Aug. 22. Its AI-graphics processing units (GPUs) have become the preferred choice by businesses to deploy in their AI-accelerated data centers. Strong ongoing demand for AI-GPUs, coupled with Nvidia's well-defined compute advantages, have allowed it to charge a premium for its hardware.
Meanwhile, Palantir's stock has gained well over 2,300% during the same time frame. Its AI and machine learning-fueled Gotham platform, which assists federal governments with military mission planning and oversight, has done a lot of the heavy lifting. With no clear one-for-one replacement for Gotham, and no true competition to its enterprise subscription Foundry platform at scale, Palantir has commanded quite the valuation premium.
What might be of concern to Nvidia and Palantir shareholders is if Druckenmiller sent these stocks packing for reasons that go beyond profit-taking.
As an example, Druckenmiller opined in May 2024 that "AI might be a little overhyped now, but under-hyped long term." Duquesne's billionaire boss astutely recognizes that every next-big-thing trend over the last 30 years has endured an eventual bubble-bursting event early in its expansion phase. In other words, investors have a propensity to overshoot when it comes to early utility and adoption rate expectations. This eventually leads to lofty expectations that aren't met and the bursting of the bubble.
No company has benefited more from the AI revolution than Nvidia. If a bubble were to form and burst, there's little question its shares would feel the impact. Though Palantir's multiyear government contracts and subscription revenue would protect it from an immediate revenue drop-off, poor investor sentiment during a bubble-bursting event would still, likely, weigh on its shares.
Valuation is another catalyst that may have enticed Druckenmiller to sell. Nvidia and Palantir are trading at respective price-to-sales (P/S) ratios of 30 and 117. Historically, businesses on the front line of a game-changing innovation have peaked at P/S ratios of 30 to 40. In short, Nvidia and Palantir are priced for perfection.
Image source: Getty Images.
Duquesne's billionaire boss has purchased this trillion-dollar AI stock in four straight quarters
Although Druckenmiller remains skeptical of some of the companies leading the evolution of AI over the short run, there is one essential artificial intelligence stock that he simply can't stop buying for his fund. Duquesne's 13Fs show buying activity spanning four consecutive quarters for trillion-dollar chip fabricator Taiwan Semiconductor Manufacturing (TSM 1.09%), which is best-known by its abbreviation, "TSMC."
Here's a breakdown of Druckenmiller's buying activity of TSMC over the previous year:
- Q3 2024: 57,355 shares purchased
- Q4 2024: 50,160 shares purchased
- Q1 2025: 491,265 shares purchased
- Q2 2025: 166,305 shares purchased (765,085 total shares held)
In just one year, TSMC has become a top-five holding for Duquesne's now greater-than-$4 billion investment portfolio.
The obvious allure of Taiwan Semiconductor is the role it's playing in AI chip manufacturing. Its chip-on-wafer-on-substrate (CoWoS) technology is essential for the packaging of high-bandwidth memory needed for AI-accelerated data centers. TSMC's monthly CoWoS capacity is expected to effectively double to between 65,000 units to 75,000 units by the end of 2025 from 35,000 per month in 2024. Further expansion is expected to 100,000 monthly units come 2026. This added capacity will help Nvidia, Advanced Micro Devices, and other chipmakers ramp up sales of their AI GPUs.
To build on the above, TSMC is dealing with quite the backlog for its services, with some orders stretching well into 2026. Backlogged orders provide a healthy level of operating cash flow predictability.
While advanced chips accounted for 60% of TSMC's net sales during the June-ended quarter, there's still plenty of opportunity outside of the AI arena. More than a quarter of its net sales trace back to chips and solutions used in next-generation smartphones. The proliferation of 5G wireless networks has led to a steady smartphone upgrade cycle.
Another 10% (combined) of Taiwan Semiconductor's net sales derive from Internet of Things devices and chips used in automobiles. Vehicles and household appliances becoming more reliant on technology is excellent news for TSMC.
Duquesne's billionaire chief might also be attracted by TSMC's valuation. Though its forward-year price-to-earnings (P/E) ratio of 21 represents a modest premium compared to recent years, TSMC's annual earnings growth rate of 20% or greater makes its forward P/E quite palatable.
