Key Takeaways
- Berkshire Hathaway reveals $4.3 billion Alphabet stake while selling more Apple shares
- Apple remains Berkshire’s largest holding despite selling nearly three-quarters of original position
- Move comes as Warren Buffett prepares to step down as CEO after 60 years
Berkshire Hathaway has disclosed a significant $4.3 billion investment in Alphabet, Google’s parent company, while continuing to reduce its massive Apple holdings. The revelation comes as legendary investor Warren Buffett prepares to step down as chief executive at year-end, concluding his remarkable 60-year leadership tenure.
According to SEC filings, Berkshire held 17.85 million Alphabet shares as of September 30, making it the company’s tenth-largest US stock holding. Simultaneously, the conglomerate reduced its Apple stake to 238.2 million shares from 280 million in the previous quarter.
Strategic Portfolio Shifts
The Alphabet investment marks a notable departure from Buffett’s traditional preference for value-focused companies over technology stocks. Despite selling nearly three-quarters of the more than 900 million Apple shares it once owned, Apple remains Berkshire’s largest investment at $60.7 billion as of September end.
Market reaction was immediate, with Alphabet shares rising 1.7% in after-hours trading following the disclosure. Investors often view Berkshire’s new stock positions as positive signals.
Buffett’s Tech Evolution
The move represents an evolution in Berkshire’s approach to technology investments. At the company’s 2019 annual meeting, both Buffett and late vice chairman Charlie Munger expressed regret about missing earlier opportunities with Google.
“We screwed up,” Munger said at the time. Buffett added: “He’s saying we blew it.”
It remains unclear whether Buffett, investment managers Todd Combs and Ted Weschler, or incoming CEO Greg Abel initiated the Alphabet purchase. Buffett typically oversees the largest deals.
Broader Portfolio Changes
Between July and September, Berkshire purchased $6.4 billion in stocks while selling $12.5 billion, marking its twelfth consecutive quarter as a net seller. The company also sold approximately 6% of its Bank of America shares, though the bank remains Berkshire’s third-largest holding.
Other portfolio adjustments included exiting the position in homebuilder D.R. Horton while increasing stakes in Chubb and Domino’s Pizza.
Leadership Transition Underway
As Buffett prepares to hand over leadership of the $1.1 trillion conglomerate to Greg Abel on January 1, Berkshire’s cash reserves have swelled to a record $381.7 billion. Investors note the company has grown increasingly cautious about stock valuations, refraining from share repurchases for over a year and avoiding major acquisitions for nearly a decade.
Berkshire owns nearly 200 companies spanning various sectors, including BNSF Railway, multiple energy and industrial firms, and well-known retail brands such as Dairy Queen, Fruit of the Loom and See’s Candies.
