Daniel Loeb's $2.2 Billion Bet on AI: Beyond Nvidia to Amazon, Microsoft, and Meta

In an industry where innovation is paramount, artificial intelligence (AI) continues to be a game-changing factor. While Nvidia (NASDAQ: NVDA) has been at the forefront of the AI revolution, it seems some investors are venturing beyond, in search of other AI-driven companies with substantial growth potential. Billionaire investor Daniel Loeb, CEO of the hedge fund Third Point LLC, is leading this shift with significant investments in a trio of companies reshaping the AI landscape: Amazon (NASDAQ: AMZN), Microsoft (NASDAQ: MSFT), and Meta Platforms (NASDAQ: META), amassing a combined worth of $2.2 billion.

Loeb, known for his aggressive investment style and insightful market forecasts, has indicated a firm belief in AI's transformative power. Maintaining this stance, the investor has shifted some of his focus away from Nvidia, despite the chipmaker's explosive 262% year-over-year revenue growth as of its fiscal 2025 first-quarter report.

Instead, he sees untapped value in Amazon, which stays ahead in e-commerce and leads cloud services through Amazon Web Services (AWS). As AI adoption soars, an increase in cloud usage seems inevitable, which augurs well for AWS, given its vast potential outlined by Loeb. His position in Amazon has recently increased by 21%, bringing the stake to a sizable 5.1 million shares or nearly 12% of Third Point's portfolio, all while Amazon's stock remains attractively priced at 3 times forward sales.

Microsoft also captures Loeb's attention thanks to early moves to infuse AI into its products, including the AI-powered digital assistant Copilot. Despite trimming his holdings in Microsoft by 12%, the overall value of Third Point's position grew, and he anticipates potential incremental revenue from Copilot could bolster the company's finances significantly.

Meta Platforms, with its focus on algorithm-led content curation and strategic targeting of digital advertising, represents another significant holding for Loeb. With Meta's latest dive into language model AI, its platforms' vast user data could further catapult the company to AI-driven success. Having initiated his position in Meta in the third quarter of 2023, Loeb has continued to bolster his investment, now making up roughly 8% of Third Point's holdings.

Loeb's diversification might signal an important shift in the investment landscape, with high-quality AI entrants catching investor attention. While Nvidia continues to dominate the GPU and AI space, the broader horizon presents attractive avenues for growth, particularly as these companies offer competitive advantages at reasonable valuations. It's worth noting that while Loeb's AI-centric investment strategy may seem prophetic, it remains rooted in a thorough understanding of market trends and company valuations.