Billionaire Stanley Druckenmiller, After Dropping Nvidia and Palantir in Recent Years, Just Made Another Striking AI Move. Should You Follow?

The artificial intelligence (AI) investing theme has been a promising one in recent years, and this hasn't escaped the attention of billionaire money managers. Many of them have added AI stocks to their portfolios and benefited as these stocks advanced. Investors have piled into the industry as the technology may be game-changing for companies across industries -- it may help them become more efficient and more innovative, for example. And this could lead to spectacular earnings growth.

Some companies have even started to benefit from this exciting technology -- those that offer AI products and services, and those that are early adopters. Two of the biggest success stories so far are Nvidia, the AI chip leader, and Palantir Technologies, an AI-driven software company.

And billionaire Stanley Druckenmiller of the Duquesne Family Office has invested in both earlier in this AI boom. Druckenmiller has since sold his shares of Nvidia in late 2024 and of Palantir early last year, though both companies continue to deliver explosive growth. And in the latest quarter, Druckenmiller made another striking AI move. Let's find out what that was -- and consider whether you should follow.

Image source: Getty Images.

Druckenmiller's past with Nvidia and Palantir

So, first, let's consider Druckenmiller's past with Nvidia and Palantir. In the second quarter of 2023, Nvidia was Druckenmiller's top holding, and the stock went on to deliver a 238% increase that year. But a year later, the billionaire began reducing his position, and by the end of 2024, he had sold all his shares in the AI chip giant.

Druckenmiller, in an interview with Bloomberg, expressed regret, saying he sold the stock too soon -- and even said he would return to Nvidia if the valuation were right. Then, early last year, the billionaire sold all of his shares of Palantir, another AI company that had seen its valuation soar.

Though Druckenmiller's biggest holdings have been in the healthcare sector in recent times, he's still invested significantly in tech and particularly AI. About 18% of his fund was invested in technology in the third quarter of last year, for example.

Druckenmiller's sales of Nvidia and Palantir were noteworthy as these companies continue to play key roles in the AI boom, though both stocks have slipped in recent weeks amid general market headwinds. Now let's consider the billionaire's latest striking move.

A look at 13Fs

We know about these trading decisions thanks to 13F forms, filed quarterly to the Securities and Exchange Commission by managers of $100 million or more. This offers us a look at their recent movements -- and potentially could give us some investing inspiration.

In the fourth quarter, Druckenmiller, who oversees $4.4 billion, took action concerning another AI giant. This time it was Meta Platforms (NASDAQ: META). Druckenmiller sold all of his 76,100 Meta shares. He had owned them only for a short time, since the third quarter of 2025, and they had accounted for almost 1.4% of his portfolio.

We don't know the reason for this move, but the fourth quarter was a turbulent time for AI stocks. During the month of November, investors worried about the possibility of an AI bubble forming, and this put pressure on many AI stocks.

Though Meta's valuation has remained reasonable throughout the AI story, the company has been spending heavily on an AI build-out. Meta recently forecast 2026 capital expenditures in the range of $115 billion to $135 billion to support this growth.

Meta's advertising revenue

Meta can take on these big goals as it delivers double-digit growth and billion-dollar revenue from advertising. Advertisers rush to promote their wares across Meta's popular apps, from Facebook to Instagram. Meanwhile, Meta's AI work is meant to boost the advertising experience and results as well as better serve Meta users. All of this should power revenue even higher over time.

Still, some investors have questioned Meta's spending levels -- and that's kept them from buying the stock.

Druckenmiller's move was striking because, once again, he sold one of the industry's most promising AI players. So, should you buy Meta or follow Druckenmiller's lead? This depends on your risk tolerance and strategy. If you're a cautious investor, you may prefer other AI investments, such as cloud companies that already generate significant AI revenue.

But if you don't mind some risk, you may pick up a few shares of Meta -- it's a bargain today at 20x forward earnings estimates, and its big AI dreams could become a reality over the long run. At the same time, this isn't a huge risk since this player continues to generate significant growth thanks to its social media dominance.

Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms, Nvidia, and Palantir Technologies. The Motley Fool has a disclosure policy.