Warren Buffett confirmed he personally initiated Berkshire Hathaway’s investment in Alphabet during the third quarter of 2025. While the conglomerate’s new CEO, Greg Abel, has since increased the position, Buffett noted that Abel is the decider, citing the tech giant’s search moat and the high capital costs of competing in artificial intelligence.
The investment marks a notable shift for the 95-year-old chairman, who has long expressed skepticism regarding his ability to predict winners in the technology sector. In a recent interview with CNBC, Buffett admitted he made a mistake by failing to invest in Alphabet sooner, having previously doubted the company’s long-term dominance despite witnessing the success of its advertising model through Geico, an early customer.
Buffett’s Investment Strategy and the Alphabet Stake
Berkshire Hathaway first revealed its stake in Alphabet in the third quarter of 2025 and has since expanded its involvement. Earlier this year, the company participated in a $10 billion private placement intended to support the tech giant’s artificial intelligence infrastructure. According to reporting from The Motley Fool, Greg Abel increased the firm’s position in Alphabet Class C shares by approximately 200% during the first quarter of this year.
Despite this aggressive expansion, Buffett maintains a clear division of labor regarding the conglomerate’s leadership. 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 said, referring to Abel, who formally assumed the CEO role at the start of this year.
Competitive Moats and the AI Capital Crunch
Buffett’s interest in Alphabet centers on its fantastic moat
—the company’s dominance in the search market, where it has consistently held more than 90% share for years. However, he remains cautious about the current state of the industry, specifically the massive financial requirements for developing artificial intelligence.
“The real question with Google and all of its competitors now, because they’re all laying out hundreds of billions, and that’s real money. That’s the game they’re playing now. They weren’t playing that game with computer software.”
Warren Buffett, Chairman of Berkshire Hathaway
While Alphabet’s Google Cloud revenue climbed more than 60% in the most recent quarter, and its backlog reached approximately $460 billion, Buffett categorized Alphabet as a secondary holding compared to his preferred investments. I would say that I don’t like it as well as at least four or five other businesses that we own,
he noted.
Apple Holdings and Leadership Succession
Even with the new focus on Alphabet, Apple remains Berkshire Hathaway’s largest equity holding. Buffett dismissed concerns regarding leadership changes at the iPhone maker, expressing confidence in the internal talent at the company following news that Tim Cook is stepping down as CEO. I know more about Apple than I knew many years ago,
Buffett said. 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, that Apple’s future, the future is as bright as the past.
As of mid-July 2026, Alphabet trades at a forward earnings multiple of 24x, a valuation that has risen since Buffett’s initial entry in the third quarter of 2025. While the company continues to see record-high queries driven by AI, the long-term profitability of these capital-intensive projects remains a central point of scrutiny for Berkshire’s leadership team.
Find more reporting in our Business section.
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