Alphabet shares climbed more than five percent on Monday after Berkshire Hathaway disclosed a multibillion-dollar position in the Google parent, marking one of the conglomerate’s most notable technology moves in recent years. The gain contrasted with weakness across much of the tech sector to start the week.
Berkshire’s latest 13F filing showed a stake valued at about 4.3 billion dollars as of September 30, making Alphabet the firm’s tenth largest equity holding. The acquisition surprised many observers who have followed Warren Buffett’s historically cautious approach to high-growth technology companies, with the key exception of Apple, which he has long considered more of a consumer brand than a pure tech play.
Investment likely driven by Buffett’s lieutenants
The Alphabet purchase is widely believed to have come from Todd Combs or Ted Weschler, the two investment managers who have been taking on larger responsibility for Berkshire’s roughly 300 billion dollar stock portfolio. Still, the size of the position suggests that Buffett, who steps down as CEO at the end of the year, likely supported the decision.
Combs and Weschler previously helped drive Berkshire’s move into Amazon in 2019. Berkshire continues to hold approximately 2.2 billion dollars worth of Amazon shares today. Their growing influence aligns with Buffett’s gradual leadership transition, with Greg Abel slated to become CEO in January while Buffett remains chairman of the board.
Alphabet’s performance and valuation draw interest
Alphabet has been among 2025’s standout performers. The stock has risen forty six percent this year as investors reward the company’s surge in artificial intelligence capabilities and improving profitability in Google Cloud. Once seen as a drag on margins, cloud operations have become an increasingly important earnings contributor.
Even after its rally, Alphabet trades at a lower valuation than several other AI-focused megacap companies. According to FactSet, the shares trade at 25.5 times next year’s earnings, compared with Microsoft at 32.0, Nvidia at 41.9 and Broadcom at 50.8. Analysts say this valuation gap, coupled with Alphabet’s strong cash generation and dominant market presence, likely made the stock attractive to Berkshire.
CFRA analyst Angelo Zino said Berkshire may prefer Alphabet over peers because of “the high free cash flow potential of its core business” and an earnings multiple he views as appealing relative to expected growth through 2027.
A shift in Berkshire’s tech comfort zone?
Some market strategists say the new stake signals a broader evolution in Berkshire’s investment approach as leadership transitions. Bill Stone, chief investment officer at Glenview Trust Company, said the move may indicate a “widening of the circle of competence into technology” for the next generation of decision-makers.
Buffett himself has acknowledged that passing on Google in its early years was a costly oversight. Berkshire’s insurance subsidiary Geico was one of Google’s earliest prominent advertisers, paying around ten dollars per search-ad click during the rise of online marketing. Buffett said in 2018 that, despite understanding Google’s strong economics, he was unsure whether the company’s position in the tech landscape would remain secure at the time.
