Investors are unlikely to find two more closely followed investors than billionaires Warren Buffett and Bill Ackman. Buffett, arguably the greatest investor of all time, ran the large conglomerate Berkshire Hathaway for roughly six decades until stepping down as CEO at the end of 2025. Buffett remains chairman of Berkshire's board of directors.
Ackman is the CEO of Pershing Square Capital Management, the investment manager of Pershing Square Holdings. Ackman is known not only for his activist short-selling campaigns in years past, but also for his success as a long-term investor. Pershing holds a portfolio of about 10 to 12 stocks at any one time, and it conducts thorough bottom-up analysis of each stock it buys.
In 2025, one of these legendary investors piled into Amazon (AMZN 1.30%), while the other sold most of his fund's position in the stock.
Image source: The Motley Fool.
Berkshire sells most of its position in Amazon
In the fourth quarter of 2025, Berkshire sold 77% of its Amazon position, a stock it had held since 2018. Despite owning the stock for several years, it's clear that Berkshire has never considered Amazon a core position, with it making up less than 1% of the company's massive equities portfolio.
Amazon faced challenges last year due to President Donald Trump's tariffs and questions about the company's broader artificial intelligence (AI) strategy. The company's large retail e-commerce platform, powered by one of the world's strongest logistics networks, sources many of its products from China and has many of its third-party sellers based outside the U.S. This resulted in margin compression and higher prices across the site.
NASDAQ: AMZN
Key Data Points
In its most recent earnings report, Amazon guided for operating income in its current first quarter below Wall Street analysts' projections. Furthermore, the company guided for $200 billion in capital expenditures in 2026, largely to fund AI-related infrastructure, and a significant increase from 2025. Investors have begun to grow concerned about high capex numbers like this, questioning what the actual returns will look like.
Amazon's valuation has come down significantly from its recent levels, and it now trades at 26.5 times forward earnings. However, Berkshire likes to be a long-term investor and is a value investor at its core, so it may not have believed that the company would be able to generate good returns on the intense capex. Buffett and his team would also have been more likely to sell if they were worried about its moat, given an AI strategy that may not be keeping pace with peers'.
Ackman is ultra-bullish on Amazon
Ackman clearly has a different view of the company. He allocated 14% of his fund's capital to Amazon, the third-largest position in Pershing's portfolio. Pershing scooped up shares of Amazon in April 2025, when the chaos from Trump's tariffs was at its peak. Since mid-April, the stock is up about 14%.
Ackman and his team believe Amazon "operates two of the world's great, category-defining franchises." These are the company's e-commerce business, which does $700 billion in gross merchandise value annually, and Amazon Web Services (AWS), a leading cloud player. Customers can order just about any product on Amazon and get it shipped directly to their door in a matter of days. AWS allows companies to store their data and run their businesses online by renting space in Amazon-owned and operated data centers.
In a slide presentation, Pershing noted that AWS was capacity-constrained. That's why it appears supportive of higher capex, and is expected to double data center capacity through 2027. Pershing also sees Amazon's ability to nearly double profitability in the e-commerce business through a combination of higher-margin advertising revenue, network density, and automation. Amazon is projected to see significant cost savings through the integration of robotics into its warehouse operations.
I think Ackman has a decent case to make, given the stock's lackluster performance over the past year. The company's core businesses have dominated without AI and can be big beneficiaries of it as well. Whether all of this capex investment will work out remains to be seen. But it's hard to believe that Amazon won't be able to navigate the challenges, given the breadth, scale, and moats of AWS and the e-commerce business.
