ArrowMark Slashes Alight Position Amid Growing Questions About Its Recurring-Revenue Strategy

On November 14, 2025, ArrowMark Colorado Holdings LLC disclosed in an SEC filing that it sold 9,793,024 shares of Alight (NYSE:ALIT) in the third quarter, reducing its position by an estimated $74.46 million.

• Sold 9,793,024 shares; position value dropped by approximately $74.46 million
• Change represents 0.8% of ArrowMark’s reported $5.38 billion U.S. equity assets under management (AUM)
• Fund now holds 7,927,836 shares valued at $25.84 million
• Position reduced from 1.8% to 0.48% of fund assets, placing it outside the top five holdings

What happened

According to a filing with the Securities and Exchange Commission on November 14, 2025, ArrowMark Colorado Holdings LLC sold 9,793,024 shares of Alight during the third quarter. After the transaction, ArrowMark’s stake in Alight stood at 7,927,836 shares, with a reported value of $25.84 million at quarter-end.

What else to know

ArrowMark’s post-sale stake in Alight represents 0.48% of its 13F reportable AUM

Top five holdings after the quarter:

• NYSEMKT: BIL: $143.38 million (2.66% of AUM)
• NASDAQ: TRMB: $126.62 million (2.35% of AUM)
• NASDAQ: CARG: $99.50 million (1.85% of AUM)
• NASDAQ: ALKT: $96.20 million (1.79% of AUM)
• NASDAQ: CERT: $90.17 million (1.67% of AUM)

As of November 14, 2025, Alight shares were priced at $2.28, down 70.27% over the past year and underperforming the S&P 500 by 84.64 percentage points

Company overview

Company snapshot

Alight operates at scale as a technology-driven provider of digital HR, payroll, and business solutions, serving a global client base. The company leverages its cloud-based platform and consulting expertise to deliver integrated services that support employee health, financial wellbeing, and organizational efficiency.

Alight's competitive advantage lies in its comprehensive service portfolio and ability to partner with major enterprise software ecosystems. It provides integrated digital human capital and business solutions, including benefits administration, healthcare navigation, payroll, and cloud-based professional services.

The company generates revenue through recurring employer solutions, cloud deployment consulting, and optimization services for leading platforms such as Workday, SAP SuccessFactors, and Oracle.

Alight targets large enterprises and organizations seeking to enhance employee wellbeing, streamline HR processes, and optimize business performance globally.

Foolish take

ArrowMark’s decision to slash its stake in Alight lands with force because it comes from an investor that usually stays the course through turbulence. A retreat this dramatic from a long-tenured holder often signals that the internal picture has shifted in ways the market has not fully processed. Moves like this prompt investors to reconsider whether the pressure on the stock reflects temporary execution issues or something deeper inside the business.

Alight sits at the center of the digital infrastructure that keeps large employers running. Its platform manages the processes that decide when employees get paid and how their benefits function. The company earns its revenue through long-term contracts that follow payroll schedules and benefit requirements. The systems usually operate unnoticed because they are designed to run without interruption. A single error can disrupt a paycheck or interfere with healthcare access, which keeps clients closely committed to the platform. The stock’s steep slide reflects doubts about Alight’s ability to move beyond project-based work and generate more predictable recurring revenue. It does not reflect a loss of demand for the services that anchor its place inside the employer ecosystem.

For investors, the debate now centers on what the stock’s sharp decline truly represents. Its slide could signal exhaustion after a difficult year, or it could mark the early formation of a new valuation floor. What matters from here is whether Alight can expand its role with existing clients, protect retention, and show cleaner cash generation from its employer solutions. If management proves it can stabilize margins and lift recurring revenue, the current share price could mark the moment when sentiment bottomed long before the business did.

Glossary

AUM (Assets under management): The total market value of investments managed by a fund or investment firm.

13F reportable AUM: The portion of assets that must be disclosed in quarterly SEC filings by institutional investment managers.

Dividend yield: Annual dividends per share divided by the share price, expressed as a percentage.

Top five holdings: The five largest investments in a portfolio by market value.

TTM: The 12-month period ending with the most recent quarterly report.

Cloud deployment consulting: Advisory services helping organizations implement and optimize cloud-based software platforms.

Benefits administration: Managing employee benefit programs, such as health insurance and retirement plans, for organizations.

Healthcare navigation: Services that assist employees in understanding and using their health benefits effectively.

Payroll: The process of calculating and distributing employee wages and salaries, including tax withholdings.

Integrated services: A combination of related offerings provided together to address multiple business needs.

Eric Trie has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends CarGurus. The Motley Fool recommends Trimble. The Motley Fool has a disclosure policy.