Bill Gates' investment trust unloaded more than $9.7 billion in Microsoft and Berkshire Hathaway stock during the third quarter, a sweeping repositioning that arrives as U.S. markets weigh surging AI-related capital expenditures and Berkshire's transition toward a post-Buffett era. Regulatory filings show the Bill Gates Foundation Trust sold over 2.3 million Berkshire Hathaway Class B shares, valued at roughly $1.1 billion, while reducing its Microsoft holdings by 64.9%, a divestiture of 17 million shares worth approximately $8.6 billion.
The Microsoft sale surprised analysts given the company's strong recent performance. Microsoft reported year-over-year gains in adjusted non-GAAP fiscal Q1 earnings and revenue, reinforcing its position as a leader in cloud and AI services. Yet Wall Street has grown increasingly uneasy about the company's escalating capital expenditures, which reached $34.9 billion for the quarter-well above the company's prior guidance of $30 billion. Those investments-spanning GPUs, CPUs, data-center construction and networking overhauls-reflect the soaring demand for Azure and the heavy infrastructure required to support generative AI.
Microsoft has signaled that capex will continue to rise, driven by expanding cloud workloads and long-term remaining performance obligations. Investors, however, are questioning whether the scale of spending will be matched by economic returns, with several high-profile names warning of an emerging AI bubble.
The Berkshire Hathaway sale comes as Warren Buffett prepares to retire at the end of the year, triggering broader reevaluation of Berkshire's long-term valuation. While Gates has reduced his Berkshire position steadily since 2024, the timing of this latest selloff coincides with market concern that the long-standing "Buffett premium"-a valuation boost tied to Buffett's reputation-may fade as he exits the company he spent six decades shaping. Berkshire's operating divisions, from insurance to rail transport, have also faced pressure as inflation and capital-cost increases ripple through the conglomerate.
Gates' ties to Buffett span two decades. He joined Berkshire's board in 2004 and served until 2020, while Buffett remained a trustee of the Gates Foundation until 2021. Buffett's 2006 pledge to donate 85% of his Berkshire stake to charity-much of it earmarked for the Gates Foundation-was altered in 2024, when he told The Wall Street Journal that donations to the foundation would end after his death.
Beyond Microsoft and Berkshire, Gates exited several major positions during the quarter. The trust sold its entire stakes in United Parcel Service and Crown Castle, along with reductions in:
- 3.3 million shares of Waste Management
- 3 million shares of Canadian National Railway
- 1 million shares of Caterpillar
- 700,000 shares of Walmart
- 150,000 shares each of FedEx and Kraft Heinz
- 110,000 shares each of Waste Connections and Hormel Foods
The moves align with a broader pattern of hedge funds trimming exposure to richly valued technology stocks. Michael Burry-whose Scion Asset Management closed weeks after he warned of an AI bubble-took large short positions against Nvidia and Palantir. Bridgewater Associates founder Ray Dalio has made similar warnings, emphasizing risk discipline at a moment when global markets remain unsettled.
