Warren Buffett sells Apple stock—and the move is sending ripples across Wall Street. For years, Apple symbolized Berkshire Hathaway’s rare but massive embrace of big technology. Now, the Oracle of Omaha is steadily trimming that iconic position while quietly building a new stake in a trillion-dollar artificial intelligence powerhouse that has already delivered eye-popping gains since its IPO.
Key Points
The shift, revealed in Berkshire Hathaway’s latest quarterly filings, offers a rare look into how one of the world’s most disciplined investors is rethinking value, growth, and artificial intelligence in today’s expensive market environment.
A notable change inside Berkshire Hathaway’s portfolio
During the third quarter, Warren Buffett sells Apple stock again, reducing Berkshire Hathaway’s holdings by another 41.7 million shares. While Apple remains Berkshire’s single largest investment, it now represents about 21% of the portfolio—down dramatically from levels seen just two years ago.
In fact, Berkshire has cut its Apple position by roughly 74% over that period. The reduction has been gradual rather than abrupt, signaling strategic caution rather than a loss of confidence in Apple as a company.
At the same time, Berkshire initiated a new position in Alphabet, the parent company of Google. The firm purchased approximately 17.8 million shares, a stake that now accounts for about 2% of Berkshire’s equity portfolio.
Though small compared to Apple, the Alphabet investment is symbolically significant. Buffett has historically avoided technology stocks, especially those tied to fast-changing innovation cycles. Alphabet’s inclusion suggests that artificial intelligence has altered that long-held stance.
Why Apple remains strong—but increasingly expensive
To understand why Warren Buffett sells Apple stock, it’s important to look at Apple’s current fundamentals and valuation.
Apple delivered solid financial results in its most recent quarter. Revenue climbed 8% year over year to $102 billion, driven by strong demand for iPhones, Macs, and services. Earnings per share rose 13%, supported by operational efficiency and continued share buybacks.
The company’s broader investment appeal remains intact. Apple dominates the premium smartphone market, with iPhones accounting for about 43% of smartphone sales in the September quarter. Its installed base now exceeds 2.35 billion active devices worldwide, creating an unmatched ecosystem.
That massive user base places Apple in a powerful position to monetize artificial intelligence. The company recently introduced “Apple Intelligence,” a suite of generative AI features designed for newer devices. While those tools are currently free, reports suggest Apple plans to roll out paid AI services in the coming years.
Despite these strengths, valuation has become a growing concern. Wall Street expects Apple’s earnings to grow at roughly 10% annually over the next three years. Against that outlook, the stock trades at around 36 times earnings—a level many analysts consider stretched.
Using common valuation metrics, Apple’s price-to-earnings-to-growth ratio stands near 3.6. Readings above 2 are often viewed as expensive, particularly for a company with slowing growth. From a value investor’s perspective, the numbers suggest limited upside at current prices.
This valuation tension helps explain why Warren Buffett sells Apple stock while still acknowledging the company’s exceptional business model.
Alphabet emerges as Berkshire’s AI-focused bet
As Apple’s valuation raises eyebrows, Alphabet offers a different narrative—one centered on artificial intelligence-driven growth across multiple businesses.
Alphabet reported strong third-quarter results, with revenue rising 16% to $102 billion. Earnings surged 35%, reflecting improved efficiency and accelerating demand for AI-related products and services.
The company’s core advertising business remains dominant, but AI is reshaping how that dominance translates into revenue. Alphabet has integrated generative AI tools into Google Search and advertising platforms, improving conversion rates and increasing query volumes.
Advertisers are seeing better performance from AI-enhanced search campaigns, reinforcing Google’s competitive edge in digital advertising. That improvement is crucial, as advertising remains Alphabet’s largest source of revenue.
Google Cloud and AI infrastructure momentum
Another key reason Warren Buffett sells Apple stock while buying Alphabet lies in the cloud and infrastructure opportunity.
Industry analysts increasingly rank Google Cloud among leaders in large language models, AI development platforms, and conversational AI tools. Demand for AI infrastructure has surged, driven by enterprises building and deploying generative AI applications.
Alphabet’s custom Tensor Processing Units, or TPUs, have become a competitive advantage. These AI chips are now used by major clients, including Apple and Anthropic, and could see broader adoption across the tech industry in coming years.
The ability to design and deploy proprietary AI hardware gives Alphabet greater control over costs, performance, and innovation—factors that matter deeply in long-term value creation.
Waymo adds a long-term growth option
Alphabet’s artificial intelligence ambitions extend beyond advertising and cloud computing. Its autonomous driving unit, Waymo, is emerging as a potential future revenue engine.
Waymo already operates commercial robotaxi services in six U.S. cities, including Phoenix, San Francisco, Los Angeles, Austin, Atlanta, and Miami. The company plans to launch in additional cities across Texas and Florida, while testing vehicles in more than a dozen other locations.
Autonomous driving remains a long-term bet, but Waymo’s expanding footprint positions Alphabet ahead of many competitors. For investors like Buffett, these optional growth drivers add to the company’s long-term appeal without dominating the core business.
Valuation tells a different story than Apple
While Apple faces valuation pressure, Alphabet’s pricing appears more balanced. Analysts expect Alphabet’s earnings to grow at approximately 16% annually over the next three years—significantly faster than Apple’s projected growth.
Alphabet trades at roughly 30 times earnings, resulting in a price-to-earnings-to-growth ratio near 1.9. Compared with Apple’s PEG ratio of 3.6, Alphabet looks more reasonably valued relative to its growth prospects.
For a value-focused investor, that contrast matters. It helps explain why Warren Buffett sells Apple stock while initiating a position in Alphabet, even after its shares have already delivered extraordinary long-term gains.
A lesson in long-term investing discipline
Alphabet’s stock has risen an astonishing 12,180% since its 2004 IPO, pushing its market value to around $3.7 trillion. It now ranks among the three largest companies in the world.
That Berkshire is only now buying shares highlights a core investing lesson: missing early gains doesn’t disqualify a stock from future opportunity. What matters is valuation, durability, and long-term cash generation at the time of purchase.
Buffett’s move underscores the importance of flexibility. Even legendary investors reassess assumptions as industries evolve and new data emerges.
Market reactions and investor takeaways
The market’s response to the news has been measured rather than dramatic. Apple shares have remained resilient, reflecting confidence in the company’s fundamentals. Alphabet’s stock has also held steady, supported by optimism around AI-driven growth.
For individual investors, the takeaway is not necessarily to mimic Buffett’s trades but to understand the reasoning behind them. Warren Buffett sells Apple stock not because Apple is broken, but because valuation and future returns may no longer align with his strict investment discipline.
Meanwhile, Alphabet represents a diversified AI play across advertising, cloud computing, custom hardware, and autonomous driving—all at a valuation that still leaves room for growth.
Conclusion: a quiet but meaningful shift
In trimming Apple and adding Alphabet, Berkshire Hathaway is signaling a subtle but important shift in how it views technology and artificial intelligence. The move reflects valuation discipline, not a rejection of innovation.
Warren Buffett sells Apple stock as part of a long-term rebalancing, while betting that Alphabet’s AI-driven ecosystem can deliver durable growth for years to come. For investors watching closely, the message is clear: even the most iconic holdings are not immune to reevaluation when the numbers change.
