Berkshire Hathaway’s $6 Billion Bet on Alphabet Signals AI Confidence
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Despite a rising stock price and a shift away from traditional value investing, Berkshire Hathaway’s substantial investment in Alphabet signals a strong belief in the tech giant’s future, particularly in the rapidly evolving field of artificial intelligence. Investors are closely watching the final moves of Warren Buffett, even after he stepped down as CEO, as these decisions continue to shape the conglomerate’s massive investment portfolio.
Berkshire Hathaway’s investment decisions aren’t immediately public. The company is required to file a Form 13F with the Securities and Exchange Commission (SEC) 45 days after the end of each quarter, meaning details of transactions around February 15 – encompassing Buffett’s last days as CEO – will become clear in the coming months. The most recent information available pertains to Q3, a period during which Berkshire acquired nearly 17 million shares of Alphabet stock.
Traditionally, Buffett and Berkshire have focused on investing in businesses that are easy to understand and considered “value” stocks. The increasing prominence of artificial intelligence (AI) stocks, often characterized by high growth potential but complex business models, presented a potential departure from this strategy. However, one analyst noted that this move appears to align with Buffett’s core investment philosophy. “Investors shouldn’t ignore this multibillion-dollar message,” they stated, suggesting that others should consider following Berkshire’s lead.
Buffett’s Long-Held Respect for Google
Buffett has consistently expressed admiration for Alphabet’s core business, Google. However, Berkshire did not invest in the company until 2025. The Q3 purchase represents approximately $6 billion worth of Alphabet stock at today’s prices, constituting a 1.9% position within Berkshire’s overall portfolio – a significant allocation.
The investment is widely interpreted as a bullish signal regarding Alphabet’s potential as a leader in the AI space. While Alphabet lagged behind competitors in the generative AI race at the beginning of 2025, the company has since made substantial progress and is now emerging as a frontrunner. This progress validates Berkshire’s investment thesis.
Timing the Market: A Difficult Calculation
Determining the precise timing of Berkshire’s purchase is challenging due to the reporting delay. The stock traded around $175 as early as July 1 during Q3, a considerable difference from its current price of approximately $330. By the end of the quarter, on September 30, Alphabet’s stock had risen to $243.
A key catalyst for the stock’s rally was the resolution of Alphabet’s antitrust case. Fears of a potential breakup were alleviated when the judge ordered only minor adjustments to the company’s business model. If Berkshire acted before this news broke, it would have maximized its gains. However, the positive impact of the court decision has now been largely factored into the stock price.
Currently, Alphabet trades at approximately 30 times forward earnings, a significant increase from the 20 times forward earnings seen for much of Q3. While this represents a premium, one analyst believes it is justified. “Thirty times forward earnings has become the standard for big tech companies,” they explained, adding that Alphabet’s strong growth and leadership position in key areas warrant the valuation.
While investors who purchased Alphabet stock around the same time as Berkshire likely enjoyed greater returns, the analyst suggests that the stock still has the potential to outperform the market.
Alternative Investment Considerations
Before investing in Alphabet, investors should also consider alternative options. The Motley Fool Stock Advisor analyst team recently identified 10 stocks they believe offer superior investment potential, and Alphabet was not among them. The team highlighted past successes, noting that a $1,000 investment in Netflix in December 2004 would now be worth $474,578, and a similar investment in Nvidia in April 2005 would now be worth $1,141,628. Stock Advisor boasts an average return of 955%, significantly exceeding the S&P 500’s 196%. Investors can explore the latest top 10 list and join an investing community through Stock Advisor.
*Stock Advisor returns as of January 20, 2026.
Keithen Drury has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet and Berkshire Hathaway. The Motley Fool has a disclosure policy.
