Billionaire Ken Griffin Sells Tesla Stock and Buys an Artificial Intelligence (AI) Stock Up 1,100% Since 2023 (Hint: Not Palantir)

Key Points

• Billionaire Ken Griffin runs the most successful hedge fund in history as measured by net gains since inception, and he recently sold Tesla and bought Nvidia.

• Tesla has reported a decline in automotive revenue in three consecutive quarters, but the company has major opportunities in robotaxis and robotics.

• Nvidia dominates the AI accelerator market not only because it has the fastest chips but also because it provides adjacent hardware and software.

• 10 stocks we like better than Nvidia ›

Ken Griffin of Citadel Advisors is the most successful hedge fund manager in U.S. history as measured by net gains. Further, Citadel beat the S&P 500 (SNPINDEX: ^GSPC) by 9 percentage points during the last three years, which makes his portfolio a good place for individual investors to find inspiration.

Griffin made several noteworthy trades during the second quarter. He sold shares of Tesla (NASDAQ: TSLA) for the fourth consecutive quarter, slashing an already-small position by 30%. He also added shares of Nvidia (NASDAQ: NVDA), increasing his position by 900% such that it now ranks as his second-largest holding.

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Interestingly, Nvidia has returned 1,100% since the artificial intelligence (AI) boom began in January 2023. But Griffin consistently sold the stock (reducing his exposure in seven of the previous eight quarters) before his big purchase in 2025's Q2. Citadel now has more money invested in Nvidia than at any point since 2022, suggesting Griffin was too quick to sell and has since realized his mistake.

Here's what investors should know.

Image source: Getty Images.

Tesla: The stock Ken Griffin sold in the second quarter

Tesla's electric car business is struggling. Automotive sales have declined in three straight quarters as the company has navigated increased competition, elevated interest rates, and brand damage caused by CEO Elon Musk's political activities. The company lost more than 3 percentage points of market share in the last year as Chinese automaker BYD became the global leader in electric car sales.

However, Tesla has a substantial opportunity in autonomous driving technology. It recently introduced its first commercial autonomous ride-sharing (robotaxi) service in Texas. The company is also testing its vehicles in California, and it recently won approval to begin testing in Nevada. Morgan Stanley analyst Adam Jonas estimates robotaxi revenue will reach $84 billion by 2035.

Importantly, while Tesla trails the market leader Alphabet's Waymo -- which has commercial autonomous ride-sharing services in five U.S. cities -- the company arguably has an edge. Whereas Waymo relies on a costly sensor suite that requires city streets be mapped in extensive detail beforehand, Tesla relies solely on computer vision, which is less expensive and more scalable.

Meanwhile, Tesla is also developing an autonomous humanoid robot called Optimus. Musk says it will account for as much as 80% of the company's value in the future, telling analysts earlier this year, "Optimus has the potential to be north of $10 trillion in revenue." Tesla hopes to manufacture at least a million units annually within five years.

Tesla currently trades at a 170 times forward earnings based on estimates for 2026, which make it the third-most expensive stock in the S&P 500. Put bluntly, the company is wildly overvalued if it fails to deliver on robotaxis and autonomous robots. But the current price may appear reasonable in hindsight if it executes on those opportunities. Investors will have to decide which outcome they see as most likely.

Nvidia: The stock Ken Griffin bought in the second quarter

Nvidia dominates the market for data center graphics processing units (GPUs), chips often called artificial intelligence (AI) accelerators because they speed up demanding workloads like AI training and inference. Nvidia has over 80% market share today, and many analysts think the company will maintain that level for the foreseeable future.

Nvidia dominates the AI accelerator market not only because its chips consistently deliver superior results when benchmarked against alternatives but also because the company complements its GPUs with adjacent networking hardware and central processing units (CPUs), as well as software tools that streamline the development of a wide variety of AI applications.

Blayne Curtis at Jefferies last year highlighted that competitive moat in a note to clients. "Nvidia is in control of the ecosystem on both the hardware and software front, and their current cadence of new generations should make that lead only [grow] further," he wrote. Indeed, while Nvidia just recently started shipping its latest GPU (called Blackwell), its next generation GPU (called Rubin) will launch next year.

Looking ahead, Nvidia is well positioned to maintain its momentum. CEO Jensen Huang expects AI data center expenditures to reach $3 trillion to $4 trillion annually by the end of the decade, up from about $600 billion today. That means its addressable market will grow at least 400% in the next five years, which implies annual revenue growth in the upper 30% range at a minimum.

Indeed, Wall Street estimates Nvidia's earnings will increase at 36% annually during the next three years. That makes the current valuation of 50 times earnings seem quite reasonable. Patient investors with a time horizon of at least three years should feel comfortable buying a position in this semiconductor stock today.

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Trevor Jennewine has positions in Nvidia and Tesla. The Motley Fool has positions in and recommends Alphabet, Jefferies Financial Group, Nvidia, and Tesla. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.