Bill AckmanFounder & CEO

Artificial intelligence is closely analogous to developing a nuclear weapon in that it holds immense upside for human productivity but carries catastrophic civilizational risks. Because advanced reinforcement learning models are developing rapidly toward superhuman capabilities without humanity fully understanding biological brain architecture, strict monitoring is critical. However, halting domestic development is impractical because adversaries such as China and Russia will continue aggressively. The United States must remain the global leader in AI while instituting strong oversight that does not impair its competitive primacy.

Uncertainty is a permanent feature of financial markets, whether driven by pandemics, inflation spikes, financial crises, or technological revolutions. Rather than attempting to trade around short-term macroeconomic noise, our approach is to identify businesses so durable that an investor could comfortably hold them if the stock market were closed for a decade. Companies with wide competitive moats, superior balance sheets, and pricing power consistently survive disruptions and emerge in stronger competitive positions.

Accelerating capital expenditure by hyperscalers like Microsoft and Amazon represents high-return growth investment rather than balance sheet deterioration. Unlike capex forced by commoditization, these investments are directly responding to overwhelming, structural customer demand for computing power. Because these companies possess fortress cash flows and the ability to price compute services profitably, frontloading infrastructure spending expands their economic moats and produces attractive long-term returns on invested capital.

We focus entirely on identifying exceptionally durable, predictable, and well-capitalized enterprises with formidable competitive moats. Over decades, we have developed a curated library of businesses we would love to own at the right valuation. Most of the time, elite franchises trade at modest forward returns because the market recognizes their quality. We wait patiently for volatility or temporary misunderstandings to discount these franchises into our strike zone, typically targeting long-term internal rates of return well north of 20 percent.

Two structural market shifts drive this heightened volatility. First, the massive growth of passive index funds has effectively shrunk active trading float, amplifying the price impact of marginal buyers and sellers. Second, the dominance of leveraged multi-manager quantitative platforms and short-term hedge funds creates violent swings whenever quarterly corporate earnings deviate slightly from consensus. These structural dynamics frequently hand patient, permanent-capital investors the chance to purchase world-class companies at deep discounts.

Broad diversification makes sense when an investor lacks granular insight into specific businesses, but for experienced investors, it dilutes capital away from best ideas. Unlike parenting, where you do not rank your children, investing requires rank-ordering risk and expected return. Holding beyond a dozen or fifteen positions yields negligible diversification benefits while penalizing overall returns. Concentration allows us to allocate capital heavily into our highest-conviction holdings.

In our earlier days, we had to publish exhaustive public presentations and occasionally wage proxy contests because corporate boards and management teams refused to engage with a smaller firm. Today, Pershing Square's track record and credibility allow us to operate as an influential, collaborative shareholder. Corporate executives frequently welcome our perspective as an outside owner with industry-wide context. We prefer taking meaningful minority stakes in outstanding businesses with proven management teams over undertaking disruptive operational turnarounds.

Investing in controlled companies where operational change is desperately needed almost always yields poor outcomes. A controlling shareholder represents an insurmountable obstacle to reform. If that owner holds divergent economic interests, an entrenched emotional perspective, or an insular agenda, outside investors cannot compel necessary governance changes regardless of analytical rigor.

Early in my career, I focused on buying statistical bargains where a dollar was trading for 50 cents, selling once the gap closed. That approach required continuously redeploying capital into new ideas. Over time, I recognized that owning durable, high-quality businesses whose intrinsic value compounds from a dollar to 1.30, 1.60, and beyond is far more profitable. In a world shaped by disruptive forces like AI, business quality and enduring moats are paramount.

Pershing Square Holdings offers a compelling double discount. The vehicle trades at an approximate 33 percent discount to the net asset value of its underlying public liquid equity portfolio. Furthermore, the underlying portfolio companies themselves trade at significant discounts to our appraisal of intrinsic value and compound at attractive rates. Supported by low-cost long-term debt financing, this structure provides a wide margin of safety and powerful compounding mechanics.

Howard Hughes mirrors Berkshire Hathaway's early transition from a self-liquidating operating asset into an enduring insurance conglomerate. Howard Hughes monetizes its extensive real estate and land assets over time, generating steady excess cash flows. We are redeploying those proceeds into acquiring and expanding Vantage Holdings, a property and casualty insurer led by top-tier industry executives. Combining underwriting profitability on the liability side with superior common-stock asset management creates a powerful compounding flywheel.

As a young entrepreneur in my twenties, I shared an ambition with my father to allocate as much of the world's capital as possible through superior investment performance and subsequently reallocate those resources toward philanthropic and societal initiatives that produce the highest human return. Pershing Square was the operational vehicle to generate that capital base, and our foundation work represents the execution of the reallocation mission.

A little over seven months ago, my twenty-six-year-old daughter Lucy suffered a severe brain hemorrhage and remained in a prolonged coma following emergency decompressive surgery. Confronting that crisis exposed how little medical science understands about neurological recovery and traumatic brain injuries. We acquired a vacant, premier life sciences facility to establish the Ackman-Oxman Institute, assembling top global neuroscientists to pioneer clinical therapies that restore cognitive, speech, and motor function.

Most traditional academic research centers measure progress through academic papers and basic science publications rather than clinical patient outcomes. We established the institute with commercial discipline, minimal administrative bureaucracy, and an explicit mandate to deliver actionable treatments rapidly. By seeding commercial biotechnology ventures around breakthrough molecules, devices, and therapies, the institute creates a self-funding economic model where commercial royalties are reinvested into continuous research.

Buying Alexander's Department Stores out of bankruptcy at roughly 8 dollars per share represented 35 to 40 percent of my personal net worth at the time. The stock quickly rebounded to 21 dollars, and I sold for a quick profit. Years later, that stock compounded past 600 dollars per share because of the immense underlying value of its retail real estate. That experience taught me early on that identifying great assets is only half the battle; capturing their true compounding potential requires the patience not to sell prematurely.