Billionaire Philippe Laffont Sold 80% of Coatue's Stake in Nvidia and Is Piling Into This Critical Artificial Intelligence (AI) Infrastructure Stock Instead

Group 1: Philippe Laffont's Investment Strategy - Philippe Laffont has sold Nvidia stock for seven consecutive quarters, liquidating nearly 39.8 million shares, which represents 80% of Coatue Management's peak position in Nvidia [5][6][7] - The selling activity is attributed to profit-taking, as Nvidia's stock has increased nearly tenfold since the beginning of 2023 [7] - Laffont is shifting investments towards Taiwan Semiconductor Manufacturing (TSM), purchasing 9,962,102 shares since the start of 2023, making it Coatue's third-largest holding by market value [13] Group 2: Nvidia's Market Position and Challenges - Nvidia's stock performance has been driven by its dominance in AI-data center hardware, particularly its Hopper and Blackwell GPU architectures [8] - Competition from both direct rivals and major customers developing their own AI chips poses a threat to Nvidia's pricing power and gross margins [9][10] - Historical trends suggest that investors may be overestimating the adoption rate and utility of AI technologies, indicating potential volatility in Nvidia's stock [11][12] Group 3: Taiwan Semiconductor Manufacturing's Role - Taiwan Semiconductor is crucial for AI infrastructure, providing fabrication services for leading AI companies, including Nvidia [14] - The company is expanding its chip-on-wafer-on-substrate (CoWoS) capacity significantly, aiming for 135,000 units per month by 2026 [14] - Taiwan Semiconductor's diverse operations, including traditional CPUs and custom chips, may help it navigate potential downturns in the AI sector [16] Group 4: Market Considerations for Taiwan Semiconductor - Despite its growth potential, Taiwan Semiconductor faces challenges in maintaining its trillion-dollar valuation, particularly with potential trade issues arising from political changes [17] - The company's current trailing-12-month price-to-earnings (P/E) ratio of 30 represents a 32% premium compared to its average over the last five years, indicating potential vulnerability in a market correction [18]