Tepper’s AI Concentration: Amazon, Micron and TSMC Make Up 40% of Appaloosa’s Book

David Tepper’s Appaloosa Management entered the second half of the year with an unusually concentrated bet on the AI buildout. According to its second-quarter disclosure, roughly 40% of the hedge fund’s portfolio was spread across just three names: Amazon, Micron Technology, and Taiwan Semiconductor Manufacturing (TSMC).

Amazon is the largest of the three, accounting for more than 15% of the portfolio, and Tepper added to the position during the quarter. The e-commerce and cloud giant continues to lean on Amazon Web Services, its most profitable and fastest-growing segment, while committing substantial capital to AI infrastructure. Amazon has said its chip and networking investments pay back within two to three years even as contracts lock in customers for five or more years, and management has pointed to a $496 billion backlog alongside projections that AWS could eventually reach $1 trillion in annual revenue.

The two semiconductor positions give Appaloosa direct exposure to the hardware side of the same trend. Micron Technology designs and sells memory and storage products, organized around cloud memory, core data center, and mobile business units — categories that feed directly into data center demand. Shares of Micron rose 6.58% in the most recent session to $1,016.59, from a prior close of $953.84, leaving the company with a market capitalization of roughly $1.15 trillion.

Taiwan Semiconductor Manufacturing, the world’s largest contract chipmaker, manufactures and tests integrated circuits for customers globally and sits at the center of the advanced-chip supply chain. Its U.S.-listed shares gained 3.0% to $428.91 from a previous close of $416.43, giving it a market cap of approximately $2.1 trillion.

The disclosure underscores how some of the largest hedge funds have concentrated capital across the AI value chain rather than diversifying broadly — pairing a cloud platform operator with the memory and foundry suppliers that equip its data centers. It also reflects the scale of infrastructure spending currently underway across the industry, with hyperscalers locking in multi-year capacity agreements and chipmakers racing to expand production.

Portfolio disclosures such as Appaloosa’s 13F filings are snapshots as of quarter-end and may not reflect current positions.

What to watch

• Micron’s next quarterly earnings report and any updates on data center memory demand and pricing.
• TSMC’s monthly revenue disclosures and upcoming earnings, including advanced-node capacity commentary.
• Amazon’s next earnings call, particularly AWS growth rates, backlog figures, and capital expenditure guidance.
• Appaloosa’s third-quarter 13F filing, which will show whether the concentration increased or decreased.

Source: original release