Sanders Capital Exits $1.6B in China and Oil, Opens $2.3B Salesforce Bet: The Q4 2025 Value Pivot

When a fund manager with $86.8 billion under management opens a brand-new $2.3 billion position in a single stock while simultaneously dumping $1.6 billion across China and oil services, it's not a tweak — it's a thesis change. Sanders Capital, the deep-value firm founded by former AllianceBernstein CEO Lewis Sanders, filed its Q4 2025 13F on February 13, 2026, revealing exactly that kind of decisive pivot. Let's break down what happened and why it matters for your portfolio.

TL;DR — Sanders Capital Q4 2025

• AUM: $86.8 billion (13F), up 6.8% QoQ — an all-time record for the firm
• New Mega-Position: Salesforce (CRM) at $2.3B (2.63% of portfolio) — largest new position in recent history
• China Exit: Completely sold $645M Alibaba (BABA) stake — zero remaining exposure to China
• Oil Services Purge: Exited both Halliburton ($640M) and Schlumberger ($261M) — "peak oil" thesis
• Defense Conviction: Lockheed Martin (LMT) shares increased 126%, from $253M to $553M
• AI Concentration: ~40% of portfolio in AI-related stocks (TSMC, Meta, Alphabet)
• Top-10 Dominance: Top-5 holdings = 42.7%, Top-10 = 61.8% of the entire portfolio
• Portfolio Concentration: Just 44 total holdings — down from 47 last quarter

Filing Snapshot

Detail	Value
Filer	Sanders Capital, LLC
CIK	0001508097
Report Date	Q4 2025 (December 31, 2025)
Filing Date	February 13, 2026
13F AUM	$86.8 billion
Total Firm AUM	~$122 billion
Holdings Count	44
QoQ AUM Change	+6.8%
Founded	2009 by Lewis Sanders
Headquarters	West Palm Beach, FL
Notable Mandate	Sub-advises Vanguard Windsor II Fund

The $2.3 Billion Salesforce Bet

The headline move this quarter is a brand-new $2,282 million position in Salesforce (CRM). For context, that's not a toe-in-the-water test — it instantly becomes a top-15 holding at 2.63% of the portfolio. Sanders Capital doesn't nibble; it takes concentrated bets when it sees value dislocation.

Why Salesforce? The timing is telling. CRM traded at roughly 25x forward earnings in Q4 2025, a steep discount to its SaaS peers. The company has pivoted aggressively toward AI integration (Agentforce platform) while maintaining a disciplined capital return program. For a deep-value shop like Sanders Capital, the combination of enterprise AI exposure at a value multiple is exactly the kind of asymmetry they hunt for.

It's worth noting that Sanders already had significant tech exposure through Alphabet ($10.0B), Microsoft ($5.9B), and Amazon ($3.4B). Adding Salesforce suggests the firm sees enterprise software as undervalued relative to the semiconductor and consumer internet names that have led the AI rally.

The Great Purge: China, Oil Services, and a Bank

What Sanders Capital sold this quarter is just as revealing as what it bought. The exits paint a clear picture of where the firm sees structural risk:

Alibaba (BABA) — $645M Exit (Complete): Sanders held a meaningful Alibaba position through years of regulatory crackdowns, VIE structure concerns, and geopolitical tension. In Q4 2025, they finally pulled the plug entirely. With zero remaining Chinese exposure, this isn't a trim — it's a verdict. The fund appears to have concluded that the risk-reward for Chinese equities no longer meets its value criteria, regardless of how cheap the multiples look on paper.

Halliburton (HAL) — $640M Exit & Schlumberger (SLB) — $261M Exit: These two exits together total over $900 million in oil services exposure eliminated in a single quarter. This lines up perfectly with comments Lewis Sanders made in an October 2025 interview with Vanguard, where he described a "peak oil" scenario — not peak demand, but chronic oversupply driven by efficiency gains and the energy transition. If you believe oil services companies face a structural demand headwind, you sell them no matter how cheap they look today. That's classic Sanders: price is what you pay, value is what you get.

Citigroup (C) — $96M Exit: A smaller exit, but notable. Sanders maintains its $2.5B Bank of America position, suggesting this wasn't a financials retreat — more likely a concentration play, swapping a smaller bank position for higher-conviction names.

Doubling Down on Lockheed Martin

While most of the attention goes to the billion-dollar moves, the 125.8% share increase in Lockheed Martin deserves its own spotlight. Sanders more than doubled its position, taking it from $253M to $553M.

The thesis here likely combines multiple factors: global defense spending is on a sustained upward trajectory (NATO commitments, Indo-Pacific tensions), Lockheed trades at a historically reasonable multiple for a company with long-duration government contracts, and — critically for a value investor — the stock underperformed the S&P 500 for most of 2025, creating the kind of relative-value gap Sanders looks for.

This move also fits the broader portfolio rotation: away from commodity-exposed cyclicals (HAL, SLB) and toward businesses with more predictable, government-backed cash flows.

The Value Machine: AUM Trajectory

Sanders Capital's growth over the past three years has been remarkable. From a trough of $36.4 billion in Q3 2022, the firm has grown its 13F assets to $86.8 billion — a 139% increase in just 10 quarters.

A few things stand out in this trajectory. First, the growth has been remarkably consistent — only three quarters of negative QoQ change in the entire period, and none worse than -2.2%. Second, the firm manages approximately $122 billion in total assets, meaning the 13F portfolio represents about 71% of firm-wide AUM. Third, this growth has occurred while the number of holdings has actually decreased from 48 to 44, meaning Sanders is getting bigger and more concentrated simultaneously. That's a deliberate choice — fewer bets, bigger conviction.

Concentration and the AI Thesis

Perhaps the most striking aspect of Sanders Capital's current positioning is how much of the portfolio is tied to artificial intelligence. In his October 2025 interview, Lewis Sanders noted that approximately 40% of the Vanguard Windsor II portfolio (which Sanders sub-advises) is in AI-related stocks.

The AI exposure isn't just in obvious names. Yes, Alphabet ($10.0B) and Meta ($6.6B) are the visible bets on AI applications. But TSMC at $9.7B is arguably the more interesting call — Sanders has argued publicly that TSMC is undervalued relative to NVIDIA and Broadcom because investors overweight the Taiwan geopolitical risk. In value investing terms, that's a classic "known risk that's already in the price" argument.

Add in Microsoft ($5.9B), Amazon ($3.4B), Seagate ($4.7B, an AI infrastructure play via data storage), Accenture ($2.9B, AI consulting implementation), and the new Salesforce position ($2.3B, enterprise AI agents) — and the AI-adjacent total climbs well beyond 40%.

The fund's philosophy of "knowledge conquers emotion" is evident here: while many investors chase the latest AI momentum names at any price, Sanders is buying the same theme through stocks trading at value-investor-acceptable multiples. That's the difference between a momentum fund and a value fund that happens to be bullish on AI.

Frequently Asked Questions

What is Sanders Capital and who runs it?

Sanders Capital is a deep-value investment firm founded in 2009 by Lewis Sanders, the former CEO of AllianceBernstein. Based in West Palm Beach, Florida, the firm manages approximately $122 billion in total assets. Sanders Capital is perhaps best known for sub-advising the Vanguard Windsor II Fund, one of Vanguard's flagship large-cap value offerings. The firm's investment philosophy centers on behavioral finance — specifically that loss aversion causes investors to systematically misprice assets, creating opportunities for disciplined value investors.

Why did Sanders Capital exit Alibaba completely?

Sanders Capital sold its entire $645 million Alibaba position in Q4 2025, bringing its China exposure to zero. While the specific reasoning isn't public, the complete exit — rather than a trim — suggests a structural concern rather than a valuation call. Possible factors include ongoing geopolitical tensions between the U.S. and China, regulatory unpredictability, and the VIE (Variable Interest Entity) structure risk that makes Chinese ADR ownership legally ambiguous. For a concentrated value portfolio with only 44 holdings, every position needs to clear a high conviction bar, and Alibaba apparently no longer did.

How does Sanders Capital's AI exposure compare to other value funds?

With approximately 40% of its portfolio in AI-related stocks, Sanders Capital has significantly higher tech and AI exposure than most traditional value funds. The key difference is how they access the theme: rather than buying NVIDIA at 30x+ sales, Sanders owns TSMC (the foundry that makes the chips), Meta and Alphabet (platforms monetizing AI at value multiples), and Salesforce (enterprise AI at a SaaS discount). This approach gives AI upside with more valuation protection — the kind of trade-off a deep-value investor requires.

What does the Halliburton and Schlumberger exit signal about oil?

The simultaneous exit of both Halliburton ($640M) and Schlumberger ($261M) — totaling over $900M in oil services exposure — signals a strong "peak oil" conviction. Lewis Sanders discussed this thesis in his October 2025 Vanguard interview, pointing to chronic oversupply driven by efficiency improvements and the accelerating energy transition. For oil services companies specifically, this thesis is more bearish than for integrated oil majors, because services demand is more sensitive to drilling activity, which declines in an oversupply scenario. When a deep-value investor sells an entire sector rather than trimming, it's a structural call, not a trading decision.

How concentrated is Sanders Capital compared to other large funds?

Very concentrated. With just 44 holdings and a top-10 concentration of 61.8%, Sanders Capital runs one of the most concentrated portfolios among large institutional managers. For comparison, a typical large-cap mutual fund holds 80-150 stocks with top-10 weights of 20-30%. Even compared to other concentrated value funds, Sanders stands out: its top two holdings (Alphabet at $10.0B and TSMC at $9.7B) alone represent nearly 23% of the entire portfolio. This concentration is intentional — the firm believes that spreading capital across too many positions dilutes the edge that comes from deep fundamental research. Fewer positions also means each exit (like BABA or HAL) and each new entry (like CRM) represents a major thesis decision.