Investors are intently focused on Stanley Druckenmiller’s investment moves, given his remarkable track record as a hedge fund manager. Over three decades, he has averaged an annual return of 30% and has reportedly never registered a losing year. Currently, Druckenmiller manages his wealth through the Duquesne Family Office, which held approximately $4.5 billion in assets at the end of 2025.
In the fourth quarter, Druckenmiller made the notable decision to eliminate his position in Meta Platforms, a company often regarded as a key player in the artificial intelligence (AI) sector, while simultaneously increasing his investment in another stock within the “Magnificent Seven” group that has seen declining market performance recently.
Meta has struggled, with its stock down roughly 11% over the past year. Druckenmiller’s trading strategy generally involves a brisk turnover of positions, aligning with short-term market dynamics rather than long-term hold. It’s possible that Druckenmiller lost patience waiting for a rebound in Meta’s stock. Interestingly, after he sold his holdings, Meta’s stock experienced a favorable reaction to its recent earnings report, where CEO Mark Zuckerberg forecasted substantial capital expenditures ranging between $115 billion to $135 billion for 2026.
Meta benefits from its ongoing advancements in AI, particularly in optimizing its advertising business to increase customer engagement. However, there are underlying concerns about rising competition from other social media platforms, like TikTok, which are also investing in AI innovations. Moreover, investors are apprehensive about Zuckerberg’s spending habits, especially following the hefty losses generated by the company’s metaverse initiatives, which have resulted in substantial operating losses through its Reality Labs division since 2020.
Despite these challenges, many analysts believe Meta is positioned well for the future, given the visible improvements in its business that AI is facilitating. Ensuring that the significant capital expenditures translate into robust returns for shareholders remains a critical focus.
On a different front, Druckenmiller’s fund significantly increased its position in Amazon during the fourth quarter, raising its stake by 69% to about $170 million. The move included the acquisition of 100,000 call options on the stock.
Amazon’s stock has underperformed, declining by 9% over the past year, compared to a nearly 13% gain in the S&P 500. The company faces ongoing challenges, like tariffs introduced during former President Donald Trump’s administration, which affects its e-commerce operations heavily dependent on Chinese suppliers and third-party sellers. Furthermore, concerns regarding Amazon’s cloud AI strategy in the face of mounting competition have emerged, particularly as it announced plans to spend $200 billion on capital expenditures in 2023, primarily for expanding data center and AI infrastructure.
The market’s appetite for companies planning vast AI-related expenditures has diminished, pushing Amazon to justify its spending with demonstrable returns. Currently trading at slightly under 29 times trailing earnings, Amazon appears relatively inexpensive compared to its historical trading range over the last five years. Should tariff relief materialize, combined with Amazon’s strong positions in e-commerce and cloud services, the company could remain viable for many years to come, even as it navigates uncertain waters in the AI landscape.
