As the latest round of 13F filings hits the SEC database, the trading strategies of Wall Street’s elite are coming into sharp focus. Billionaire investor Dan Loeb, founder of Third Point, made a series of moves in the fourth quarter that have caught the market’s attention: he continued accumulating shares of AI juggernaut Nvidia (NVDA) while completely exiting his position in social media giant Meta Platforms (META).
What investment thesis lies beneath this contrasting approach?
According to Third Point’s 13F filing with the Securities and Exchange Commission, Loeb purchased 100,000 shares of Nvidia during the December-ended quarter. This marks the fourth consecutive quarter of accumulation—following acquisitions of 1.45 million shares, 1.35 million shares, and 50,000 shares in the previous three quarters.
What makes Nvidia so compelling to Loeb?
The answer lies in Nvidia’s unparalleled graphics processing units (GPUs). The company’s Hopper (H100), Blackwell, and Blackwell Ultra chips have established a virtual monopoly in AI-accelerated data centers. With GPU scarcity persisting, Nvidia continues to command premium pricing power.
More critically, when it comes to AI hardware compute capabilities, competitors aren’t even in the same zip code. CEO Jensen Huang is aggressively spending to ensure his company can introduce new advanced chips annually, maintaining its computational superiority.
Nvidia’s CUDA software platform represents another often-overlooked moat. As the toolkit developers use to maximize the potential of their Nvidia GPUs, CUDA’s ongoing evolution not only keeps existing clients loyal to the company’s ecosystem but also extends the utility of prior-generation chips.
These fundamental strengths underpin Loeb’s conviction that Wall Street’s most valuable company still has room to run. With gross margins holding firm in the mid-70% range and GPU scarcity showing no signs of abating, the thesis appears well-supported.
In stark contrast to his Nvidia conviction, Loeb’s stance on Meta underwent a dramatic reversal. The filing reveals Third Point sold its entire 220,000-share position in Meta during the fourth quarter—this after two straight quarters of purchases in the social media giant.
What triggered this sudden pivot?
On the surface, simple profit-taking may explain the move. Meta shares rallied more than 50% between April and October. Given that Third Point’s average hold time for securities in its portfolio is less than 18 months, cashing in chips wouldn’t be out of character.
But deeper factors may be at play.
First, cost pressures are mounting. Meta has been raising its capital expenditure forecast for its AI Superintelligence Lab on a near-quarterly basis. While AI has investors seeing dollar signs, rising costs could weigh on earnings growth. CEO Mark Zuckerberg has a well-established pattern of waiting years before monetizing new projects.
Second, macroeconomic risks loom. Meta generates nearly 98% of its net sales from advertising—a highly cyclical business tightly coupled with the U.S. economy. Should a recession materialize, Meta would be particularly vulnerable. Loeb may be positioning to avoid that exposure.
Beyond the Nvidia and Meta moves, Loeb also reduced positions in Amazon and Microsoft during Q4—cutting his stakes by 23% and 16%, respectively.
It’s worth emphasizing that he’s far from exiting these names. Amazon and Microsoft remain Third Point’s third and fourth largest holdings, each comprising more than 6% of the portfolio’s assets. The reasons for trimming could be numerous, including identifying more compelling opportunities elsewhere. It’s entirely possible that some of the proceeds from these sales found their way into Nvidia.
Taken together, Dan Loeb’s fourth-quarter repositioning sends several clear signals:
First, AI remains the most compelling investment theme. Four straight quarters of Nvidia accumulation suggest Loeb believes AI compute demand will remain robust, with the industry leader capturing the lion’s share.
Second, caution on ad-dependent platforms. The Meta exit indicates potential concern about companies with heavy cyclical exposure as economic uncertainty lingers.
Third, disciplined profit-taking. Even tech titans like Microsoft and Amazon face trimming after strong runs, reflecting Loeb’s flexible approach and risk management discipline.
For everyday investors, Loeb’s moves offer a reference point: maintain conviction in enduring trends like AI while staying vigilant about cyclical risks. As with any investment decision, understanding the underlying logic matters more than blindly following the trades.
