Pershing Square Capital Management’s investment in Alphabet has transformed into a multibillion-dollar windfall since its Q3 filing. At the end of September, the fund held 6.32 million Class C shares and 4.84 million Class A shares. Since then, the value of those positions climbed by approximately $2.04 billion, marking a gain of roughly 203%–289% on the initial Q1 2023 purchases. Ackman’s decision to trim 10% of his Class A stake in Q3 left the fund with 519,007 fewer shares, potentially foregoing a portion of these subsequent profits. This performance cements Alphabet as one of Pershing Square’s most lucrative bets to date.

Alphabet’s upcoming Q4 results hinge on three critical growth vectors that underpin its long-term thesis. First, Gemini integration into Google Search and other services now generates millions of user interactions daily, enhancing search relevance and user engagement without disrupting core metrics. Second, Google Cloud continues to scale profitably, delivering 34% year-over-year revenue growth in Q3 and expanding operating margins by seven percentage points, evidence of strong enterprise demand for AI infrastructure. Third, legacy advertising remains robust, with search and YouTube ad revenues both growing in the mid-teens percentage range, preserving Alphabet’s high-margin cash engine and setting the stage for another double-digit top-line increase.

A federal judge in California has revived core antitrust claims against Google, allowing a proposed class action to proceed under Section 2 of the Sherman Act and California’s Unfair Competition Law. Plaintiffs allege that Google’s exclusive agreements with device makers and browser developers foreclosed competition by pre-setting Google as the default search engine across major platforms. Citing the Department of Justice’s 2024 findings, the court held that these arrangements plausibly denied rivals the scale and user data needed to compete on features such as ad-free subscriptions or privacy-focused rewards. While the suit’s timing allegations were partially trimmed, claims concerning conduct since 2017 remain intact, potentially exposing Google to substantial consumer damages if liability is established.