Buffett's Berkshire Hathaway Dramatically Increases Stake in Google Parent Alphabet

Warren Buffett's Berkshire Hathaway significantly expanded its investment in Alphabet, the parent company of Google and YouTube, by 83% during the second quarter. This move has elevated Alphabet to become Berkshire's third-largest stock holding.

As of June 30, Berkshire Hathaway reported owning nearly 106 million shares of Alphabet, valued at approximately $37.8 billion. This represents a substantial increase from the 57.8 million shares held at the end of the first quarter. The acquisition includes a $10 billion investment announced in June, intended to support Alphabet's expansion of its artificial intelligence infrastructure.

Apple continues to be Berkshire's largest stock investment, with holdings valued at $66 billion at the close of June. American Express followed, valued at $51.3 billion, with Bank of America and Coca-Cola ranking fourth and fifth, respectively.

In addition to the Alphabet investment, Berkshire Hathaway divested its stake in alcoholic beverage producer Constellation Brands, an investment held for a year and a half. The company also increased its holdings in Delta Air Lines and Macy's, both of which were initiated in the first quarter. The Delta investment saw a 44% increase, reaching 57.3 million shares worth nearly $5.4 billion, while the Macy's stake more than doubled to approximately 7.3 million shares valued at $173 million.

These portfolio adjustments were detailed in a regulatory filing that outlines Berkshire's U.S.-listed stock holdings, which constitute the majority of its $323.8 billion equity portfolio. During the second quarter, Berkshire purchased $23.5 billion in stocks and sold $3.7 billion, marking the end of a 14-quarter period where sales had consistently outpaced purchases.

Berkshire's cash reserves also saw a reduction, falling to $364.7 billion on June 30 from $380.2 billion on March 31. This decrease is partly attributed to $4.5 billion in stock buybacks. Warren Buffett, who remains Berkshire's chairman, stated that the decision to invest in Alphabet was his own. Berkshire began building its stake in Alphabet during the third quarter of last year. Buffett has indicated that he and CEO Greg Abel consult on capital allocation decisions for the Omaha, Nebraska-based conglomerate.

Further portfolio changes included an increase in shares of homebuilder Lennar and the disclosure of a small stake, valued at $580,000, in D.R. Horton, another home builder. Conversely, Berkshire reduced its holdings in Ally Financial, Bank of America, Capital One, DaVita, Kroger, and Nucor.