After Cisco’s purchase of cybersecurity software firm Splunk, high-profile investors Jeff Smith (left) and Alex Sacerdote (right) hit home runs as shares surged. Splunk shares soared by more than 20% after Cisco announced that it would buy the cybersecurity software company for $157 per stock in a cash-only deal worth approximately $28 billion. Splunk’s two large hedge funds that had stakes in the company were rewarded by this move. Smith’s Starboard Value’s bet of more than $430m on Splunk at the end June was its third largest holding. Splunk, according to the investor, could benefit from artificial intelligence but was not executing well. Smith, who has been one of the leading activist investors of the last two decades, is now a proponent of AI, comparing it to the Internet. He was one of the activists investors in Salesforce, a customer relationship management software company. Sacerdote, who runs the Whale Rock Capital Management hedge funds, which focus on technology, media, and telecommunications at the end the second quarter, had invested over $170 million into Splunk. Sacerdote, a former Fidelity Portfolio Manager, first purchased Splunk at the start of 2022. What other bets are they making? Smith, who called AI “enormous” opportunity, invested in other stocks to take advantage of the boom. Last quarter, he dramatically increased his holdings in Wix.com to make it his ninth largest investment. Wix.com provides a platform for web development that allows businesses to move their workflow online. The stock has risen by about 16% in the past year. Smith increased his stake in Acacia in the second quarter. This pushed the patent licensing firm to the 10th largest position in Starboard’s stock portfolio. Whale Rock’s biggest holdings were a number of Big Tech companies such as Microsoft, Meta, Nvidia, and Netflix. Whale Rock is fond of HubSpot, a cloud-based platform for customer relationship management. Whale Rock’s 5th-largest stock bet at the end of June has seen a 66% increase in value this year. Sacerdote had also made a large bet on Fortinet, another cybersecurity company similar to Splunk. Guggenheim upgraded Fortinet from neutral to buy after a sell-off triggered by earnings created an attractive entry point. The stock has still risen 20% in the past year.