Wall Street's Bold Bet on Alphabet While a Legendary Investor Trims His Position

The Market’s Unwavering Confidence in the AI Giant

When it comes to Alphabet stock, Wall Street’s consensus couldn’t be clearer. In November 2025, a survey of 66 analysts covering the company revealed a striking pattern: not a single analyst recommended selling. Instead, the bullish sentiment dominated. Twelve analysts assigned a “strong buy” rating, while 45 more gave it a “buy” rating. Only nine held back with a “hold” recommendation.

This overwhelming optimism reflects Alphabet’s impressive fundamentals. The company pulled in $102.3 billion in Q3 2025 revenue, representing a 16% year-over-year increase. More impressively, earnings surged 33% to approximately $35 billion. For investors watching the artificial intelligence space closely, these numbers signal that Alphabet isn’t merely participating in the AI transformation—it’s leading it.

Why the AI Narrative Matters More Than Ever

Google’s Gemini large language model now boasts over 650 million monthly active users, demonstrating real-world adoption beyond hype. The integration of generative AI features like AI Overviews into Google Search has kept the core business firing on all cylinders. Google Cloud, the company’s fastest-growing segment, is accelerating precisely because of AI-driven demand for cloud infrastructure and computational power.

The potential applications extend far beyond search and cloud services. Agentic AI—where autonomous systems handle complex tasks—could fundamentally reshape how users interact with Google’s platforms. These AI agents may evolve into personal shopping assistants, potentially unlocking new revenue streams for Google Search.

Ackman’s Quiet Moves: Profit-Taking or Strategic Recalibration?

Bill Ackman’s hedge fund, Pershing Square Capital Management, holds only 11 stocks, making each decision highly deliberate. In Q3 2025, Ackman made a notable move: he reduced his Alphabet Class A holdings by trimming over 519,000 shares, cutting the position by roughly 9.7%. Interestingly, this occurred while maintaining substantial stakes across both share classes—Pershing Square still holds over 11 million Class A and Class B shares worth around $3.3 billion.

What prompted this reduction? Ackman hasn’t publicly explained the move, leaving observers to speculate. The most plausible explanation is profit-taking. Alphabet Class A shares have delivered strong returns since Ackman initiated his position in Q1 2023. Reducing exposure while maintaining a large allocation could reflect a measured approach—locking in gains while keeping the door open for further upside.

Meanwhile, Pershing Square made minimal adjustments elsewhere. The fund trimmed its Uber position by just 0.1% and made no changes to Amazon or Alphabet Class C holdings during the quarter, suggesting selective rebalancing rather than a wholesale retreat from AI exposure.

The Long-Term Case Remains Compelling

Beyond current financials, Alphabet’s innovation pipeline deserves serious consideration. Gemini 3.0’s recent launch could accelerate Google Cloud adoption further. Waymo, Alphabet’s autonomous vehicle unit, now operates ride-hailing services in five U.S. cities with expansion planned to 11 additional cities plus London—a bet-the-company initiative that could reshape urban transportation.

Perhaps most intriguing is Google Quantum AI, which has achieved two significant quantum computing milestones. Within the decade, this unit aims to deliver a large-scale quantum computer with broad applications, potentially positioning Alphabet at the intersection of multiple transformative technologies.

The Disconnect Between Expert Positioning and Investor Action

What emerges from this picture is a subtle tension: Wall Street analysts remain almost unanimously bullish on Alphabet, yet even seasoned investors like Ackman engage in tactical portfolio adjustments. This doesn’t necessarily signal doubt about the company’s direction. Rather, it reflects the complexity of managing concentrated portfolios while maintaining discipline around position sizing.

For long-term investors, the narrative around Alphabet’s AI capabilities, cloud growth acceleration, and emerging opportunities in autonomous vehicles and quantum computing suggests the stock retains meaningful upside potential—despite recent profit-taking by sophisticated market participants.