Berkshire Hathaway, the American multinational conglomerate holding firm led by Warren Buffett, has announced a new investment in Alphabet, Google’s parent company. Following this move, the company stated that it held approximately a $4.3 billion stake in Alphabet at the end of the third quarter.
As the multinational powerhouse invested in Alphabet, it continued to reduce its investment in Apple significantly. The company reduced its Apple holdings by another 15% this quarter, totaling $60.7 billion.
### Surprising Move for Buffett’s Value Investing Approach
Regarding Berkshire Hathaway’s holdings in Alphabet, several individuals expressed shock at the decision. Buffett is renowned for his value investing strategy and typically hesitates to invest in rapidly growing tech firms. However, with this recent investment, a regulatory filing revealed that Alphabet has solidified its position as the 10th largest stock holding for Berkshire Hathaway as of the end of September.
### Buffett Admits Missing Out on Early Google Investment
Berkshire Hathaway has reportedly owned Apple for several years. Yet, analysts note that Buffett views the iPhone maker more as a consumer products company rather than a typical tech firm. Following this perspective, it is believed that Berkshire’s investment managers, Ted Weschler or Todd Combs, likely made the purchase of Alphabet shares.
These individuals have a history of engaging with technology stocks. Reports indicate that one of them began investing in Amazon as early as 2019, and Berkshire still holds approximately $2.2 billion worth of Amazon shares. Notably, Amazon has attracted significant investment after being ranked as a top performer this year, with its stock price surging by 46%. The soaring demand for AI has also greatly boosted Amazon’s cloud services business.
Buffett once confessed that he had missed out on investing in Google early on, despite recognizing its advertising potential. Interestingly, Berkshire’s auto insurance company, Geico, was one of Google’s early users, paying approximately $10 each time someone clicked on their ad.
“I had seen the product work, and I knew what kind of profits they were making,” Buffett said in 2018. However, he admitted that he didn’t fully understand the technology to determine whether it would be the one to outcompete all others.
### Berkshire Reduces Several Holdings Amid Market Changes
In 2024, Berkshire sold off two-thirds of its Apple shares, a move that surprised many given Buffett’s reputation as a long-term investor. The company also decreased its Apple holdings in the second quarter of the year. Despite these ongoing sales, Apple remains Berkshire Hathaway’s largest stock investment.
In addition to Apple, the company reduced its stake in Bank of America by 6%, bringing the holding to under $30 billion. Berkshire also trimmed investments in Verisign and DaVita during the third quarter.
According to sources close to the situation, Berkshire has been a net seller of stocks for 12 consecutive quarters amid climbing prices in the tech-focused bull market.
### Leadership Transition at Berkshire Hathaway
Looking ahead, Buffett is set to step down as CEO at year’s end, with his longtime partner Greg Abel taking the helm. Investors are closely watching how Berkshire is positioning itself during this transition, seeking insights into potential shifts in its investment strategy under new leadership.
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