Bill Ackman on Economic Moats

In November, the Investment Manager opportunistically deployed capital into Meta following a decline in the share price amid concerns around AI-related spending. Also in November, the Investment Manager announced that it had exited its investments in Chipotle and Nike, and in February 2026, it exited its investment in Hilton. Further information on the PSH portfolio can be found in the Investment Manager’s Report. CORPORATE ACTIONS The Board has undertaken a number of corporate actions over the past year. • PSH continues to believe that its ability to access low-cost, long-term, investment grade debt is a competitive advantage. We seek to maintain leverage generally between 15% and 20% of total assets, utilising investment- grade debt financing without mark-to-market or other margin-like covenants. PSH’s long-term debt management strategy is to manage leverage over time by growing NAV through strong performance and by laddering maturities through new debt issuances. In April, PSH completed a €650 million senior notes issuance due 2030, at a rate of 4.25%. In October, PSH completed a $500 million senior notes issuance due 2032, at a rate of 5.50%. PSH’s current debt profile is comprised of a structured set of maturities matching its long-term investment horizon, with a weighted average maturity of six years and a weighted average cost of capital of 3.6% as of December 31, 2025.

Past performance is not a guarantee of future results. All investments involve risk, including the loss of principal. Please see accompanying endnotes and important disclaimers on pages 120-123. New Equity Positions: Meta Platforms, Inc. (“Meta”) At the end of last year, we initiated a significant position in Meta, a company we have followed closely for many years. Alongside Alphabet, another one of our core holdings, Meta is the dominant leader in the highly attractive and secularly fast- growing digital advertising space. The company principally owns and operates a “Family of Apps” (Facebook, Instagram, WhatsApp) with an entrenched global user base of over 3.5 billion daily active users. This vast, diverse, and highly engaged audience is the source of a powerful network effect: as more users engage more deeply with Meta’s apps, the apps become incrementally more valuable to both users and advertisers, creating an exceptionally durable competitive advantage. The company's deep insights into consumer behavior and interests allow advertisers to precisely target specific demographics and intentions, making Meta an indispensable and essential marketing platform for businesses seeking highly effective ad spend. Our opportunity to invest in Meta arose following the company’s Q3 2025 earnings call in October when it announced it would spend significantly more on AI initiatives in 2026 than investors had expected, leading to a 20% share price decline.

Pershing Square Holdings, Ltd. 13 In our view, concerns surrounding Meta’s elevated spending overlook the transformative potential of AI to accelerate near- term revenue growth and reinforce its long-term competitive moats. We believe Meta is one of the clearest beneficiaries of AI and is already seeing material impact across its core business drivers: content recommendation, user engagement, ad monetization and new product innovation. Improved AI content recommendation systems are driving material growth in user engagement, especially for the video format with time spent watching videos on Instagram up more than 30% year-over-year. Moreover, as content on Meta’s platforms has increasingly broadened from the “social graph” (friends/family/followed accounts) to include a wider range of interest-based content from a diverse group of creators, AI recommendation engines enable the company to better understand, surface, and curate content that users desire. Likewise, AI greatly improves ad monetization by leveraging Meta's rich first-party data to deliver more relevant and targeted ads. Automation capabilities – from the company’s Advantage+ suite to its generative AI ad creation tools – facilitate an end-to-end self-serve model for advertisers. We are also encouraged by AI's potential to unlock new commercial use cases and engagement modes.

We anticipate that over time Uber and Waymo will further expand their partnership to include additional cities and geographies. Beyond Waymo, Uber is laser focused on advancing and partnering with many smaller AV companies. In 2025, Uber broadened its go-to-market AV approach, announcing new and expanded partnerships with Avride, Baidu, Lucid, May Mobility, Momenta, Nuro, Nvidia, Pony.ai, Waabi, Wayve, WeRide and others. Overall, Uber is advancing dozens of geographically focused commercial pilots with a host of regional partners, creating line-of-sight to tens of thousands of autonomous vehicles covering major metropolitan cities operating on Uber’s network within the coming years. We believe that as AV technology becomes more widespread, the value of the “driver” will lessen, and the overall marketplace network will become an increasingly important point of differentiation. We believe that AV technology will not be a winner-take-all model and that third-party networks, and Uber in particular, have a valuable role to play. The stock market clearly underappreciates the durability of Uber’s moat, the magnitude of its earnings growth, and the strategic role it will play in shaping the future of mobility. Uber currently trades at less than 20 times our estimate of earnings per share, which is a bargain relative to our expectation that Uber will generate 30% or greater annual earnings per share growth over the medium-term.

NeTlix’s business has highly favorable characterisYcs which include: • its subscripYon-based, highly recurring revenues, which have enormous future growth potenYal • a truly best-in-class management team and unique high-performance culture (consider NeTlix’s remarkable pivot from DVD rental by mail, to video streaming, to becoming one of the greatest producers of beloved content ever) • economies of scale and superb quality in its industry-leading content, which should conYnue to drive future growth and widen the company’s powerful compeYYve moat • pricing power derived from the enormous value it delivers to consumers compared with other alternaYves • substanYal margin expansion, with the opportunity for conYnued improvement due to economies of scale and the company’s rapidly growing, global subscriber base • an improving free cash flow profile which should allow for conYnued investments in growth as well as the return of cash to shareholders We began analyzing NeTlix in connecYon with our investment in Universal Music Group, so we were prepared when the stock price declined sharply last Friday.all-