A week after Berkshire Hathaway disclosed that it had purchased 17.8 million Class A shares of Alphabet in the third quarter, the position has already increased by roughly $415 million, reaching nearly $5.35 billion as the stock rose 8.4%.
This has raised concerns about whether the renowned cautious company is becoming more at ease with higher risk, AI driven growth, something Warren Buffett has long shied away from.
Alphabet's stock increased 3.1% on Monday to start the week, presumably in response to the announcement of Berkshire's acquisition.
Following the release of Google's new Gemini 3 AI model on Wednesday, which has garnered favorable evaluations, the surge intensified.
Even though Nvidia's impressive profits failed to completely allay concerns about a "AI bubble," some of Alphabet's top tech rivals saw major declines over the same time period.
The rapidity of the advances has made it clear who within Berkshire is actually driving the change. Buffett is getting a lot of credit from the public, but he has always allowed fund managers to do their own thing.
Alphabet doesn't feel like Buffett's "type of stock," according to a CNBC piece that stated, "We know that's not the case, however, since portfolio managers Ted Weschler and Todd Combs are able to act as "free agents."
Yun Li of CNBC stated that Weschler or Combs "likely" made the initial investment, citing their influence over a number of Berkshire's more "tech leaning" ventures, including as its $2.2 billion bet in Amazon.
Li also mentioned Buffett's previous disengagement from certain tech decisions. Buffett made a point of telling CNBC's Becky Quick that it wasn't his choice and that "no personality change has taken place" even before that stance was initially revealed in 2019.
The Alphabet transaction was presented by Bloomberg Opinion columnist Nir Kaissar as a possible philosophical departure from Buffett's conventional rigor.
"AI is orders of magnitude more complicated than selling books or pet food online," he said, recalling Buffett's reluctance to invest in companies he did not completely grasp during the late 1990s internet boom. "Combine opaque technology with premium valuations, and you're sure to lose Buffett," he continued.
The action represents "a very different approach than Berkshire's shareholders are used to, notably, a new willingness to pay more now for potentially higher growth down the road, a chance Buffett rarely took, if ever," according to Kaissar, who speculated that it would indicate a change under CEO designate Greg Abel.
