Billionaire Dan Loeb Sold 29% of Third Point's Stake in TSMC in Favor of Another Trillion-Dollar Artificial Intelligence (AI) Stock

Key Points

• Quarterly-filed Form 13Fs give investors a way to track the buying and selling activity of Wall Street's genius money managers.

• Growth stock-focused billionaire Dan Loeb has been a seller of Taiwan Semiconductor stock over the last year -- and profit-taking might be only part of the reason behind this selling.

• Meanwhile, he's made the face of the artificial intelligence (AI) revolution his fund's third-largest holding over the last two quarters.

• 10 stocks we like better than Nvidia ›

Earnings season -- the six-week period where many of the S&P 500's components report their operating results -- is often viewed as the most important data dump every quarter. But don't overlook the invaluable information provided by Form 13F filings with the Securities and Exchange Commission.

A 13F is a quarterly filing that shows investors which stocks, exchange-traded funds (ETFs), and select options Wall Street's genius fund managers have been buying and selling. Though 13Fs aren't without their flaws (e.g., they may contain stale information for active hedge funds), they can clue investors into the stocks and trends that are intriguing successful money managers.

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While Warren Buffett tends to be the most-followed of all billionaire asset managers, he's not the only one with a lengthy track record of spotting good deals hiding in plain sight. Third Point's billionaire investor Dan Loeb is another money manager who rightly garners attention.

Image source: Getty Images.

What's made Loeb such an interesting fund manager to follow is his penchant for investing in large- and small-cap growth stocks, as well as his lure to artificial intelligence (AI) stocks. Based on 13Fs, Loeb has been a decisive seller of world-leading chip fabricator Taiwan Semiconductor Manufacturing (NYSE: TSM), which is more commonly known as "TSMC," over the last year. But he's also done quite a bit of buying in the AI arena, with another trillion-dollar AI stock on the menu.

Billionaire Dan Loeb has been sending shares of TSMC to the chopping block

Though examining share purchases and sales over the prior three-month period can be informative, looking back six or 12 months can help investors spot patterns. Third Point's last four 13Fs show that billionaire Dan Loeb has been a clear seller of TSMC stock.

Between the end of June 2024 and the midpoint of 2025, Loeb has sent 595,000 shares of Taiwan Semiconductor Manufacturing to the chopping block, which reduced his fund's stake in the company by 29%. The 1.43 million shares still held makes TSMC Third Point's fifth-largest holding by market value.

One of the likeliest reasons for selling TSMC stock is simple profit-taking. From the start of May 2024 through the midpoint of 2025, Taiwan Semiconductor stock rallied about 65%. Loeb upped his fund's position in TSMC notably during the second quarter of 2024. With the average hold time of Third Point's top-10 positions clocking in at roughly 11 months, it's not surprising to see Loeb actively locking in gains.

However, there may be more at play than just a desire to take profits.

For example, TSMC is valued at nearly 22 times forward-year earnings. Though a forward price-to-earnings (P/E) ratio of 22 is actually quite reasonable when compared to other market-leading AI stocks, it's a premium compared to the forward P/Es of 13, 16, and 20 that TSMC ended the year with in 2022, 2023, and 2024, respectively. The perceived bargain that Loeb nabbed isn't as apparent in the forward P/E ratio any longer.

It's also possible that Loeb has concerns about TSMC's outlays to expand its manufacturing presence in the U.S. Among the reasons the company is expanding production in the U.S. is to avoid tariffs from the Donald Trump administration. The cost to build and expand U.S. chip-manufacturing facilities, coupled with potentially higher production costs and lead times, has the potential to weigh on TSMC's operating results.

Nevertheless, Taiwan Semiconductor Manufacturing appears to be ideally positioned to benefit from the AI revolution. Even if there are demand hiccups, its lengthy backlog and revenue diversity – it's a leading provider of chips for next-generation smartphones, automobiles, and internet of Things devices -- set the company up for long-term success.

Image source: Getty Images.

Dan Loeb made this trillion-dollar AI stock a top-three holding over the last two quarters

On the other end of the spectrum, Third Point's Dan Loeb entered 2025 with no shares of Wall Street's largest public company and the leader of the artificial intelligence revolution, Nvidia (NASDAQ: NVDA). But during the first and second quarters, he oversaw the purchase of 1.45 million and 1.35 million shares of Nvidia, respectively.

Loeb's fund now owns 2.8 million shares of this trillion-dollar colossus of a company, and it's grown into his fund's third-largest holding.

For more than two years, the lure for investors with Nvidia has been its AI-graphics processing unit (GPU) dominance. The company's Hopper (H100) and Blackwell GPUs dominate in AI-accelerated data centers, with Nvidia CEO Jensen Huang noting that "demand is extraordinary" for Blackwell Ultra (the successor to the Blackwell chip). No other competitors have come close to matching the compute capabilities of Nvidia's AI hardware.

Huang is attempting to bring a new advanced chip to market on an annual basis. The ramp up of Blackwell Ultra is ongoing, with the debut of Vera Rubin and Vera Rubin Ultra expected in the second-halves of 2026 and 2027, respectively. The latter two will run on the all-new Vera processor and should help solidify Nvidia's position atop the compute pedestal.

Loeb likely also appreciates the role Nvidia's CUDA platform has played in delivering eye-popping sales and profit growth. CUDA is the toolkit developers lean on to get the most out of their Nvidia GPUs, including the building and training of large language models. It's effectively become the anchor that keeps clients loyal to Nvidia's ecosystem of products.

The other catalyst that may have enticed Loeb to nearly double Third Point's stake in Nvidia during the second quarter was the early April swoon for Wall Street. President Trump's tariff announcements on April 2 led to a short-lived mini-crash in the major stock indexes. This allowed opportunistic investors, including billionaire money managers, to go shopping.

But continued upside in Nvidia is far from a guarantee. History tells us that every next-big-thing trend for more than 30 years has endured a bubble-bursting event early in its existence. Investors have a terrible habit of overestimating the early stage utility and adoption rate of new technologies, which eventually leads to sky-high expectations not being met. This same fate seems likely for the artificial intelligence revolution.

Competitive pressures should eventually weigh on Nvidia, as well. In particular, having many of its top customers by net sales developing their own AI-GPUs could cost it valuable real estate in data centers, or at the very least may delay future upgrade cycles.

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Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.