IN-DEPTH: Activists zero in on tech with record board gains
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Activist investors have been increasing their grip on U.S. tech boards. In a record year for board wins in the space, dissidents have more than doubled the volume of seats gained while the sector navigates the sweeping impact of artificial intelligence.
According to Diligent Market Intelligence (DMI) data, the first nine months of the year saw activists win 33 board seats at tech targets, compared to 14 in the same period in 2024.
The data reveal that 82 tech companies faced activist demands in the first three quarters of 2025, a 9% increase on the same timeframe last year and an upsurge that many say looks set to continue.
Indeed, for primary- and partial-focus activists, gaining access to the boardroom and seeking the removal of incumbents were the dominant areas of focus, accounting for more than half the 21 demands advanced by the cohort at companies in the sector.
“I would think there is going to be more activity,” said Sumit Gautam, founder of Scalar Gauge. “It's actually a really interesting time - if you can sort through the confusion and identify high-quality companies and if they're trading at good multiples, then they could create a lot of value, especially as the total addressable market expands dramatically with enterprise AI adoption.”
Piling on pressure
The second half of the year has seen many prominent activists gather at the same tech stocks, in pile-ons reminiscent of the 2023 campaigns at Salesforce that are still being felt – with the fourth and fifth board appointments since the activists arrived taking their seats in July.
In September, two of proponents of change at Salesforce were revealed to have taken positions in payments platform Bill Holdings. Starboard Value was first to unveil a holding of 8.5% and a quest for four board seats, while Elliott Management’s 5%, which was built before Starboard disclosed its position but publicized afterwards, added another layer of pressure.
Mid-year saw Starboard divulge another major holding – taking 9% of travel brand Tripadvisor after Chair Greg Maffei faced almost 70% opposition at the company’s annual meeting earlier in the year, with many citing overboarding concerns. A month later, Palliser Capital joined the fray with a reported push to sell the company.
According to Peter Michelsen, shareholder activism practice lead at Qatalyst, the coming weeks are likely to be busy ahead of the next proxy season.
“The logical timing is October and November, people will be building positions and positioning themselves for nomination windows opening in January and February,” Michelsen explained.
Settlements set the tone
One quirk of the sector is that few activist campaigns end in a proxy fight – with all the board seats to change hands this year and last won through settlements. One of 2025’s most striking victories was by Kent Lake Capital, which took four seats in a February settlement with medical records technology company Veradigm.
Gautam’s Scalar Gauge reached a settlement with accounting technology platform Blackline in March that saw software industry veteran Scott Davidson named to an expanded board of 11.
The following month saw Scalar Gauge strike an accord with PagerDuty, which in turn found room for former American Airlines boss Donald Carty on its staggered board.
April also saw Starboard notch up two directorships at Autodesk with the naming of Jeff Epstein, Oracle’s former head of finance, and Christie Simons, once of Deloitte, to the software designer’s board. Jeff Smith's Starboard also etched out a May settlement at Qorvo which saw the chip manufacturer add a new director and avert a proxy fight.
Elliott scored a settlement in July when Hewlett Packard Enterprise agreed to add a technology executive to its board and set up a strategy committee.
Anson Funds, meanwhile, made progress at Match Group with the dating platform averting a proxy fight by adding ex-NBCUniversal executive Kelly Campbell to its board in an April agreement that, according to the activist, set the stage to help the company “lead a revolution of the online dating category driven by artificial intelligence.”
A new ecosystem
With continued stake building by big name activists at key tech companies and even the U.S. government building a position in chip giant Intel in a rare move seen to "help secure America's technological edge", the sector has seen activism take on a new shape.
The rate at which technology companies adopt and exploit opportunities from AI is indeed likely to prove a key factor for activists who see parallels with past transitions.
“Some of the boards of these software companies, they may not be moving fast enough on incorporating AI. Companies who did not get on the cloud, well they just got left behind,” Gautam said, warning that those that either put off incorporating AI or do so “as a layer on top” could be most vulnerable to activist attention.
Data storage and provision – another side effect of AI – is also cited by some in the space as likely to draw more activist attention, with Elliott upping its stake in data center real estate company Equinix in July.
And as activists reevaluate the changing landscape, some say smaller and mid-cap companies could be among the most vulnerable in the sector. Most at risk could be those focused on enterprise software, where concerns regarding AI-related disruption is likely to be felt most sharply, according to Michelsen.
There seems to be an across-the-board “discount devaluation” being applied to such companies, Michelsen said, warning that the hard yards for activists will be to parse what in some cases is a “significant discount between intrinsic value and current trading value.”
For Gautam, targets in the enterprise software space should be “good-quality companies," with "very sticky customers, demonstrable return on investment, good gross and net retention rates and high gross margins."
