Buffett logs into Alphabet

Warren Buffett doesn’t usually swipe right on big tech—but Alphabet got the match.

Berkshire Hathaway bought 17.8 million shares of the big tech behemoth during the third quarter, a stake valued at about $4.3 billion at the end of Q3, making it the firm’s 10th-largest equity holding. Alphabet rose 3.11% today on the news.

It’s a surprising move for the $300 billion-AUM conglomerate, which typically avoids high-growth tech and sticks to classic value plays. Although Berkshire Hathaway also owns Apple, Buffett has long emphasized it as a consumer brand—and while he trimmed his stake in Apple by nearly 15% last quarter, it’s still the largest position in Berkshire’s portfolio.

Fundamentals help the case: Alphabet trades at the lowest P/E ratio among the Magnificent Seven (25x vs. an average of 35x) and continues to generate strong free cash flow as peers burn through cash investing in AI.

Alphabet is up 49.97% YTD, and momentum could continue: Google is expected to launch its Gemini 3 AI model, with prediction market Polymarket putting the odds of a release this week at 91%, a timely catalyst as Alphabet works to prove that its own AI can counter earlier fears that ChatGPT would erode traditional search.

Not everyone is riding the AI wave

Other hedge funds made bold moves last quarter, too: Peter Thiel’s Thiel Macro dumped its entire Nvidia stake, a position that accounted for about 40% of the fund’s equity portfolio. That exit echoes a broader shift: SoftBank also unloaded its Nvidia position last month, and Michael Burry’s Scion Asset Management disclosed put options on the stock as of Sept. 30.

Some investors see signs of an AI bubble, especially after Nvidia briefly brushed a $5 trillion valuation in October. Others flag structural concerns beneath the surface: Burry, for instance, has criticized hyperscalers like Microsoft and Alphabet—the very companies buying Nvidia’s chips—for using extended depreciation schedules that artificially suppress reported expenses and inflate profits.

What comes next?

Investor sentiment around AI has turned cautious. The Magnificent Seven have collectively fallen about 5.8% since the end of October as doubts build around stretched valuations and slowing momentum.

But Nvidia could flip the narrative. CEO Jensen Huang told investors in October that the company has $500 billion in combined orders for 2025 and 2026, implying meaningfully higher 2026 revenue than Wall Street forecast. If Nvidia can live up to those lofty expectations when it reports earnings on Wednesday, investors may jump back into tech alongside Buffett.—SY