Ackman adds Netflix, Visa, Mastercard in $5B portfolio overhaul

Bill Ackman's Pershing Square deployed nearly $5 billion into six new holdings, betting the market's AI obsession left blue-chip quality names mispriced.

Bill Ackman's Pershing Square deployed nearly $5 billion into six new holdings including Netflix, Visa and Mastercard, betting the market's AI obsession left blue-chip quality names mispriced.

"When we first invested in early 2022, investors feared an escalating content arms race among a crowded field of streaming entrants," Ackman wrote in a second-quarter letter to investors. "Netflix has since effectively won the streaming wars."

The new positions also include eye-care firm Alcon, exchange operator Intercontinental Exchange and financial data provider S&P Global, according to the letter and regulatory filings. Ackman said shares were acquired starting in the second quarter for funds including Pershing Square USA, which listed on the New York Stock Exchange in April. Netflix fell 50 percent from a June 2025 high of $134 to $67 in mid-June, creating the entry point. The streaming giant now trades at 22.6 times trailing earnings with $11.15 billion in free cash flow and a 49.5 percent return on equity.

The overhaul marks the billionaire's biggest portfolio restructuring in years. Pershing Square USA was down 3.5 percent for the year through July and London-listed Pershing Square Holdings fell 9.2 percent, versus a 13 percent gain for the S&P 500, raising pressure on Ackman to revive performance.

Netflix Returns After $400M Exit

The Netflix position marks a return to a name Ackman dumped in 2022 at a loss of roughly $400 million just months after buying it, citing a "loss of confidence" in its future. The fund held 3.15 million shares as of June 30, representing 4.9 percent of its portfolio. Ackman said Netflix's subscriber base now exceeds any competitor's by a wide margin, and its ability to convert 90 percent of earnings into free cash flow lets it outspend rivals on content as advertising scales up. The company executed a record $4.7 billion share repurchase in the second quarter with $27 billion remaining under authorization, and ad revenue is projected to double to $3 billion by 2026.

Toll-Takers and Data Franchises

Visa and Mastercard, brief Ackman holdings in 2008, were repurchased after both derated to 22 times forward earnings. Ackman called them "the highest-quality businesses in the world," capital-light toll-takers that earn a nominal fee on each transaction without taking material risk. He dismissed stablecoin threats, arguing crypto is growing in places where cards are not incumbent and that stablecoins cannot offer the fraud protection, credit access and rewards of credit cards.

S&P Global, which Pershing previously owned in 2017, was picked up after AI disruption worries caused a 25 percent drop in February, pushing its valuation to 19 times earnings per share from 25. Ackman described each of its benchmark franchises as a high-margin, IP licensing business inside an oligopolistic market structure. Intercontinental Exchange, a more recent purchase, generates nearly 70 percent of earnings from its "highly moated" exchange operations, anchored by an energy franchise with revenues more than two-and-a-half times its next-largest competitor.

The additions come during a busy year for Ackman, who listed both his hedge fund and Pershing Square USA on the New York Stock Exchange, exited an estimated $1.5 billion position in Universal Music Group after the company rejected his $65 billion takeover bid, and added Microsoft earlier this year after its stock dropped following an earnings report. His portfolio also includes Uber Technologies, Meta Platforms, Amazon.com, Fannie Mae and Freddie Mac. The new names are expected to appear in 13-F filings due Friday.

The strategy echoes Ackman's historical playbook of buying temporarily mispriced winners rather than broken businesses. His best trades — Chipotle, Canadian Pacific, Hilton — worked because he identified operational inflection points before the market priced them in. Whether the new positions repeat that pattern depends on whether the market treats Netflix's growth deceleration as temporary normalization rather than structural decline, and whether the ad business inflection and margin expansion materialize as projected.

This article is for informational purposes only and does not constitute investment advice.