Billionaire Ken Griffin Is Investing Heavily in These 2 AI Companies That Have Surged by at Least 88,780%

Hedge fund Citadel Advisors, led by billionaire Ken Griffin, was highly active in the second quarter. Griffin and his team notably boosted the firm's holdings in several stocks and added new names to their portfolio.

Among the high-profile companies Griffin invested in during this period were Microsoft ( MSFT -2.68%) and Apple ( AAPL -0.16%), two staples on Wall Street.

These tech titans are not only among the world's most valuable businesses by market capitalization, but they've also delivered remarkable long-term returns. Both companies have been expanding into the rapidly evolving artificial intelligence (AI) space. But with valuations over $3 trillion, are they still appealing prospects for long-term investors?

Let's take a closer look.

MSFT Total Return Level data by YCharts

1. Microsoft

Citadel Advisors bought 1.87 million shares of Microsoft during Q2, marking a remarkable 1,635.75% increase in its position.

Griffin's team isn’t alone in ramping up investments in this tech giant. There are compelling reasons why Microsoft has outperformed the broader market this year, rising 32% since January. The company’s strong financial performance supports this view, as both revenue and profit have shown impressive growth.

In Microsoft’s fiscal fourth quarter 2025, which ended June 30, revenue soared 18% year over year to $76.4 billion. Operating income grew even faster, reaching $34.3 billion for a 23% annual increase. Net income was up 24% to $27.2 billion. Simply put, Microsoft continues to seize growth opportunities while maintaining cost discipline.

At present, Microsoft's cloud division is the company's primary driver, offering a range of AI-enabled services and growing more rapidly than its other segments. Microsoft is steadily closing the gap with Amazon, which still leads the cloud computing industry. While Amazon entered the market first, Microsoft has long supplied businesses with its Office 365 suite and other services, making it a natural choice for companies looking to move to the cloud with a trusted partner.

The most encouraging aspect is that we are still in the early stages of both cloud computing adoption and the AI boom. As Amazon CEO Andy Jassy put it, “85% of worldwide IT spending remains on-premises.”

Even with its massive scale, Microsoft is well-positioned for future growth in both cloud and AI. Factoring in its competitive advantage from high switching costs, a robust dividend, and strong cash generation, Microsoft currently stands out as an excellent investment choice.

2. Apple

Citadel Advisors ramped up its stake in Apple by an astonishing 10,715.95% during the second quarter—a move that may seem surprising at first.

This year, Apple has dealt with various headwinds, notably concerns over tariffs. Since much of Apple’s manufacturing is overseas, especially in China, the Trump administration’s push for higher tariffs on imports has left investors worried about the potential impact on Apple’s operations.

In response, Apple has pledged to invest $600 billion in U.S. manufacturing over the next decade to address government concerns and lessen tariff risks.

However, Apple’s challenges go beyond trade policy. Its new Apple Intelligence platform—a suite of AI services for its latest devices—has not met the high expectations of consumers and investors, leaving the company trailing in this fast-growing sector.

These and other factors have led Apple’s stock to decline 5% so far this year. Yet, Griffin and his team clearly viewed this as a buying opportunity.

While Apple may face turbulence ahead, I believe the stock remains a strong long-term holding. The company continues to deliver substantial profits. In the third quarter of fiscal 2025 ending June 28, revenue grew 10% year over year to $94 billion, and earnings per share climbed 12% to $1.57.

Importantly, Apple continues to be a cash-generating powerhouse. Even though its trailing 12-month free cash flow fell 11.6% year over year, it still totaled a hefty $96.2 billion.

AAPL Free Cash Flow data by YCharts

Apple has the resources to invest heavily in research and development, which should eventually drive results, especially in AI. The company has a history of entering markets late but then delivering a superior product, as it did with the iPhone and later with AirPods. The difference now is Apple’s brand is even more valuable than before.

With an enormous base of loyal customers, billions of active devices, and a thriving services segment boasting over 1 billion paid subscriptions, even one breakout product can have a profound effect on Apple’s bottom line.

Finally, Apple may once again find ways to counteract tariff threats. CEO Tim Cook managed this challenge during Trump’s first term, and it’s not certain that aggressive trade policies will persist.

All considered, Apple stock remains appealing, especially for those willing to invest for the long haul.