Klarman's Baupost Group Buys Stake in SoundHound, Cuts Position in Warner Bros Discovery

Billionaire Seth Klarman's Baupost Group hedge fund entered a position in artificial intelligence (AI)-powered voice and speech recognition company SoundHound AI (SOUN) in the first quarter while sharply trimming its stake in Warner Bros Discovery (WBD), according to its recent 13-F filing.

It is important to note that 13F filings report on investments as of the end of the reporting quarter, and provide no information about what price at which shares were purchased or any profit or loss from any share-ownership exits.

New Positions in AI, Data Center, Materials Companies

Klarman's fund ended the first quarter with 1.1 million shares of SoundHound, which provides AI voice solutions and recently reported better-than-expected quarterly results amid rising demand for its products. SoundHound came into the spotlight after Nvidia (NVDA) unveiled a position in the company at the end of last year.

Baupost took on several other new positions in the first three months of this year as well, most notably a 2.6 million-share stake in Chinese data center company GDS Holdings (GDS).

Klarman also entered stakes in construction materials firm Eagle Materials (EXP), contract research organization Fortrea Holdings (FTRE), and electrical distribution and services parent company Wesco International (WCC).

Baupost added to its existing stake in data analytics firm Clarivate (CLVT), ending the quarter with 30.6 million shares, about 5 million more than it had at the end of 2023.

Sharp Reduction in Warner Bros Discovery

Klarman's fund dramatically reduced its position in media giant Warner Bros Discovery across the first three months of 2024. The firm ended the quarter with 3.7 million shares, down from 25.2 million at the end of the fourth quarter of 2023.

Baupost made smaller cuts to its prior stakes in building materials company CRH (CRH), Fidelity National Information Services (FIS), and Theravance Biopharma (TBPH), among others.

Exits From Tower Semiconductor, Garrett Motion, Gray Television

The most recent 13-F also revealed several companies that Baupost eliminated from its portfolio entirely in the first quarter. These include Israeli chipmaker Tower Semiconductor (TSEM), engineering outfit Garrett Motion (GTX), and broadcasting firm Gray Television (GTN).