Warren Buffett, chairman of Berkshire Hathaway, has acknowledged that he was the primary advocate behind the company’s recent significant investment in Alphabet, the parent company of Google. Although he stepped down as chief executive of Berkshire Hathaway at the end of last year, Buffett, 95, remains actively involved in major decision-making alongside Greg Abel, who assumed the CEO role in January.
In an interview, Buffett highlighted that he initiated Berkshire Hathaway’s large-scale purchase of Alphabet shares, emphasizing the collaborative relationship with Abel. “I am not doing anything that he doesn’t approve of. He’s not doing anything I don’t approve of. We talk all the time, but he is the decider,” Buffett explained, underlining their joint approach to managing the company’s portfolio.
The investment comes amid heightened investor concern over Alphabet’s extensive expenditures on artificial intelligence (AI) infrastructure. Alphabet’s shares responded positively, rising $8.09, or 2.3 percent, to $365.42 in mid-morning trading in New York following Buffett’s remarks.
Berkshire Hathaway’s stake in Alphabet was first disclosed at the end of 2023, with the company acquiring 7.85 million shares valued at approximately $4.93 billion during the third quarter. Since then, Berkshire has expanded its holdings to shares now worth nearly $21 billion. Additionally, the conglomerate participated in a $10 billion private placement, part of an overall $80 billion initiative to finance Alphabet’s AI development.
Buffett described the current AI investment landscape as a major shift in the technology sector, noting that Alphabet and its competitors are now committing hundreds of billions of dollars to the race. “That’s real money. That’s the game they’re playing now. They weren’t playing that game with computer software,” he said.
Historically, Buffett has been cautious about technology stocks, favoring companies with predictable business models. He previously compared Apple, Berkshire Hathaway's largest holding, to a consumer products company. Reflecting on his recent investment decisions, Buffett admitted to CNBC that he “made a mistake” by not buying Alphabet shares earlier. He remains confident in Apple’s prospects, praising the company’s global talent and innovation. “If you’re Apple, you’ve got very, very smart people all over the world shooting and trying to figure out how to make sure that Apple’s future is as bright as the past,” he said.
Earlier this year, Buffett also cautioned about market exuberance, remarking that “we’ve never had more people in a more gambling mood than now” after U.S. stock indices reached record highs. He warned that “prices for an awful lot of things will look very silly,” signaling continued vigilance amid the booming market environment.