David Tepper’s Appaloosa exits top AI stock while maintaining overweight in sector

Selling a stock that’s up 591% sounds like a problem most investors would love to have. David Tepper, whose Appaloosa Management runs a portfolio worth between $7.5 billion and $7.7 billion, recently made exactly that call, and the reasoning behind it says quite a bit about where smart money thinks the AI trade goes from here.

In the second quarter of 2026, Appaloosa liquidated its full position in SanDisk, selling all 281,250 shares for roughly $179 million. The stock had peaked at $2,354.39 on June 22, making it the best-performing major AI-adjacent name of the year. Tepper didn’t hold on for more. He filed the exit in a 13F submission on August 14, confirming positions as of June 30.

From memory chips to the full AI stack

After trimming the position that had carried much of its first-half performance, Appaloosa moved aggressively into companies sitting closer to the core of AI infrastructure spending. Amazon became the fund’s largest single holding, with 5 million shares valued at approximately $1.19 billion, representing around 16% of the total portfolio.

Appaloosa also expanded its existing stakes in TSMC and Nvidia while initiating new positions in Broadcom and CoreWeave. A new stake in SpaceX also appeared in the portfolio.

Micron was the one position where Appaloosa pulled back meaningfully. The fund trimmed its Micron holdings by 41%, cutting roughly 690,000 shares. The remaining position is still valued at approximately $1.13 billion.

A 32% first-half return sets a high bar

The context for all of this maneuvering: Appaloosa reported a 32% return in the first six months of 2026, driven largely by its memory-chip exposure.

Broadcom plays a slightly different role, supplying networking components and custom silicon that large cloud operators use to wire their data centers together. CoreWeave, which provides GPU-accelerated cloud computing to AI developers, only went public in early 2025 and remains a relatively speculative name.

What’s worth watching in the months ahead is whether other large funds follow the same rotation. Tepper’s fund became famous for its aggressive bets during market dislocations, including his call to buy distressed financial stocks during the 2008 crisis.