- Warren Buffett says he was the one who made the call for Berkshire to invest in Alphabet.
- The Google parent now makes up 6% of Berkshire’s portfolio and ranks in its top 10 holdings.
- The investment reflects Buffett’s lasting influence over Berkshire despite stepping down as CEO last year.
The Oracle of Omaha said he made the call for Berkshire Hathaway to invest billions into Alphabet. The conglomerate owns about $31 billion worth of stock. Buffett’s one regret? That Berkshire didn’t invest in the Google parent sooner, he said, speaking to CNBC in an interview this week.
“I initiated,” Buffett said, adding that he didn’t make any decisions that Greg Abel, his successor at Berkshire, didn’t approve of, and vice versa.
Shares of Alphabet jumped nearly 4% on Wednesday, putting the tech titan up 17% for the year.
Alphabet was Berkshire’s largest stock purchase last quarter, with the company now making up 6% of its total portfolio. The Google parent is also Berkshire’s sixth-largest holding, falling shy of Occidental, Chevron, Bank of America, Coca-Cola, American Express, and Apple, which is Berkshire’s largest investment.
Apart from its stakes in Apple and Alphabet, Berkshire has rarely invested in tech, with Buffett previously stating that he avoided the sector due to its unpredictability. In the past, he’s characterized Apple as a consumer company.
The latest investment in Alphabet also reflects Buffett’s lasting influence over Berkshire despite officially stepping down as CEO last year.
Buffett pointed to how questions surrounding AI capex are now hanging over Google and other tech giants in the artificial intelligence race. Investors have been concerned about the billions being spent on AI as many companies have yet to monetize or see considerable cost savings from the technology.
Alphabet, though, seems more likely than the others to come out on top, Buffett said.
“I made a mistake,” Buffett said of not investing in Alphabet sooner. “I think they’re more likely to be a winner based on their record than probably 90% or 95% of what gets merchandised through Wall Street,” he added.
“They don’t have any choice,” he added of companies’ AI capex spending plans. “They are now playing a game in many cases or in some cases where they’re playing a game they don’t want to play.”
He added that he didn’t like Alphabet as much as four to five other businesses Berkshire owned, but didn’t specify which ones.
