Billionaire David Tepper Sold 97% of Appaloosa's Nvidia Stake and His Entire Position in AMD in Favor of This Trillion-Dollar Artificial Intelligence (AI) Stock

Core Insights - The evolution of artificial intelligence (AI) is seen as the next significant growth opportunity for corporate America, similar to the internet's impact over 30 years ago [2] - Global GDP is projected to increase by 26% by 2030 due to AI advancements, indicating substantial economic potential [3] Investment Activity - David Tepper, a prominent billionaire investor, has been strategically reducing his holdings in major AI-GPU companies like Nvidia and AMD while increasing his investment in Broadcom [8][16] - Tepper's stake in Nvidia has decreased from 10.2 million shares to 300,000 shares, a decline of 97%, and he has completely exited his position in AMD [10] Reasons for Selling AI-GPU Stocks - Tepper's selling may be attributed to locking in gains after significant price increases in Nvidia and AMD stocks [11] - Regulatory issues, including export restrictions on advanced AI chips to China, pose risks to Nvidia and AMD's sales and margins [12] - Increasing competition in the AI-GPU market could diminish pricing power for Nvidia and AMD as supply constraints ease [13] - Concerns about a potential AI bubble forming and bursting could impact the financial performance of Nvidia and AMD [14] Broadcom's Position - Broadcom has emerged as a key player in the AI sector, with a recent opening of a 130,000-share position by Tepper [16] - The company reported $51.6 billion in sales for fiscal 2024, with approximately $12.2 billion from AI-related revenue, and expects AI-related sales to grow significantly by fiscal 2027 [19] - Broadcom's diversified operations, including wireless chips and cybersecurity solutions, position it to better withstand market fluctuations compared to Nvidia and AMD [20][22]