Billionaire David Tepper of Appaloosa Is Piling Into the AI Revolution With These 3 Big Purchases
Key Points
The evolution of AI is making waves on Wall Street, and billionaire money managers like David Tepper have taken notice.
Tepper's Appaloosa made sizable purchases of two AI application companies and one critical AI hardware provider.
All three AI titans boast sustainable competitive advantages and double-digit growth potential.
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In case you haven't noticed, artificial intelligence (AI) is kind of a big deal. Wall Street's most influential businesses are spending a small fortune to get their piece of what promises to be a multitrillion-dollar addressable market -- and prominent billionaire investors are noticing.
Following the filing of Form 13Fs with regulators on May 15, we learned that Appaloosa's billionaire boss, David Tepper, is betting big on the AI revolution. On the menu was a near-doubling in his fund's No. 1 position, Amazon (NASDAQ: AMZN), a more-than-tripling in Appaloosa's stake in Uber Technologies (NYSE: UBER), and a brand-new position in Sandisk (NASDAQ: SNDK).
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Image source: Getty Images.
Amazon
Tepper oversaw the purchase of 2,140,609 shares of Amazon during the March-ended quarter, increasing his fund's stake in the e-commerce giant by 98%.
But Amazon is much more than just an online marketplace. Its cloud infrastructure services platform, Amazon Web Services (AWS), is No. 1 worldwide in cloud-based spend. Integrating generative AI and large language model (LLM) capabilities into AWS has reaccelerated sales growth for this high-margin operating segment.
Additionally, Amazon has maintained double-digit sales growth from its advertising and subscription segments. Having billions of monthly visitors to its online marketplace provides plenty of ad pricing power, while exclusive content (e.g., Thursday Night Football) supports subscription pricing power through Prime.
Although Amazon isn't a bargain by traditional fundamental metrics, its forward price-to-cash-flow ratio is historically inexpensive.
Uber Technologies
Billionaire David Tepper was also pressing the accelerator on ride-sharing kingpin Uber during the first quarter. The 4,482,720 shares purchased represent a 242% increase from Dec. 31, 2025.
While most investors aren't linking Uber to the AI revolution, its platforms rely heavily on AI solutions to optimize routes, match riders with drivers, and dynamically price its services. It's now Appaloosa's fourth-largest holding.
Uber has consistently controlled around three-quarters of the U.S. ride-sharing market. This is a global market that Straits Research foresees growing tenfold, from $87.7 billion to $918.2 billion, between 2025 and 2033. Uber's AI integration, rock-solid operating cash flow, and brand-name should allow it to sustain double-digit annual sales growth for the foreseeable future.
Similar to Amazon, Uber is more than just ride-sharing. It also operates the Uber Eats food-delivery service and oversees freight logistics. These are cyclical operating segments that should benefit from the non-linear nature of economic cycles.
Image source: Getty Images.
Sandisk
Tepper only added one new stock to his portfolio in the first quarter, and it was NAND flash memory titan Sandisk. The 281,250 shares purchased made Sandisk a top-12 holding for Appaloosa.
Whereas Amazon and Uber are benefiting from the application side of the AI equation, Sandisk shares have gone parabolic thanks to the insatiable demand for AI data center infrastructure. Training LLMs and performing rapid, autonomous calculations isn't possible without NAND flash and high-capacity solid-state drives.
2027 EPS estimates for SanDisk $SNDK are about to bend backwards in time while still moving parabolically higher: pic.twitter.com/qRsPDqR5KA
-- Consensus Media (@ConsensusGurus) May 3, 2026
Just as Nvidia's pricing power benefited from a graphics processing unit (GPU) shortage, the otherworldly demand for memory and storage solutions in enterprise AI data centers has sent NAND flash prices through the roof. Since September 2025, Sandisk's fiscal 2027 earnings per share estimates have catapulted from less than $10 to more than $171.
Amid the backdrop of a historically expensive stock market, Sandisk shares are trading at a forward price-to-earnings ratio of just 8, despite soaring 3,370% over the trailing year.
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Sean Williams has positions in Amazon. The Motley Fool has positions in and recommends Amazon, Nvidia, and Uber Technologies. The Motley Fool has a disclosure policy.
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