Warren Buffett said he personally drove Berkshire Hathaway's decision to take a stake in Alphabet, and he emphasized that the move reflected his initiative rather than the direction of Berkshire's new chief executive, Greg Abel.
Speaking with CNBC anchor Becky Quick, Buffett, 95, stated plainly: "I initiated it." He added that while he and Abel consult frequently, they each retain ultimate authority in different respects - "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."
Berkshire first reported a position in Alphabet during the third quarter of 2025 and has since built on that holding. The conglomerate took part in a $10 billion private placement by Alphabet earlier this year, a transaction intended to support the company's artificial intelligence infrastructure. Berkshire's current position in Alphabet stock is about $31 billion.
Buffett framed his thinking on investments around businesses that can generate sustained, high returns on capital. "The trick in life is to find - I mean investing - is to find businesses that are going to earn high returns on capital for an extended period of time," he said.
When asked why he favored an investment in Alphabet relative to other large tech companies, Buffett was measured, noting Alphabet is not at the very top of his preferences within Berkshire's portfolio. "I would say that I don't like it as well as at least four or five other businesses that we own," he said.
Buffett pointed to the scale of capital commitments now required to compete in artificial intelligence as a major consideration for Alphabet and its rivals. "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," he said. "That's the game they're playing now. They weren't playing that game with computer software."
Separately, Buffett reaffirmed his positive view of Apple, Berkshire's largest equity holding. He said the company remains one of his favorites even after 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."
Summary
Warren Buffett told CNBC he personally initiated Berkshire Hathaway's Alphabet investment. Berkshire disclosed its position in the third quarter of 2025, expanded it, and joined a $10 billion private placement for Alphabet's AI infrastructure. Buffett stressed the importance of high returns on capital, flagged the massive capital needs of AI competition, and reiterated Apple as a favored holding despite leadership changes.
- Key points:
- Berkshire's Alphabet stake was initiated by Buffett and expanded after initial disclosure in Q3 2025; Berkshire participated in a $10 billion private placement and now holds roughly $31 billion of Alphabet stock.
- Buffett identifies sustained high returns on capital as the core investment criterion and notes the sizable capital commitments required for AI as a practical challenge for Alphabet and its competitors.
- Apple remains among Berkshire's top equity holdings and is viewed positively by Buffett despite the announced departure of CEO Tim Cook.
- Risks and uncertainties:
- Large-scale capital expenditures for AI could pressure returns for Alphabet and peer technology companies - an issue relevant to the technology and cloud infrastructure sectors.
- Leadership transitions at major portfolio companies, such as Apple's CEO change, create management uncertainty that could affect operational execution in the technology and consumer electronics sectors.
- Berkshire's investment decisions depend on internal approvals and discussions between Buffett and CEO Greg Abel, introducing governance dynamics that could influence timing or scale of future moves, relevant to financial markets and conglomerate investors.