Buffett and Abel Build Alphabet Into One of Berkshire's Biggest Holdings

IndustryManagement
โดย The Motley Fool·US·Read original
Summary · why it matters

Warren Buffett and newly appointed Berkshire Hathaway CEO Greg Abel have plowed tens of billions of dollars into Alphabet, making it one of Berkshire's biggest investments, after Buffett finally bought the stock in the third quarter of 2025 with shares trading around $200. Buffett had long said he missed the opportunity, noting at the 2017 shareholder meeting that he would not bet against Google, and he has acknowledged missing out on a 9,000% gain by not buying sooner. Google initially offered shares to the public at $85 each in 2004, and after a 2014 split into two share classes and a 20-for-1 split in 2022, the split-adjusted price is just $2.125 per share. Buffett said he likes the stock now because Alphabet plans to spend around $200 billion in capital expenditures this year on new data centers and AI servers, a use of capital he sees earning a high cash return. Google Cloud CEO Thomas Kurian said the average payback period on its new servers is less than two years, and roughly half that for Google's custom TPUs, while average five-year customer contracts and a two-year lead time on data center construction mean even a worst-case scenario produces a positive return. With the stock trading for less than 17 times forward earnings expectations, Buffett and Abel could keep buying in the third quarter.

Impact on stocks 3

Artificial Intelligence▲ · 2 stocks
Alphabet Inc Class C
GOOG
▲ PositiveCapitalrelevance

Buffett and Abel plowed tens of billions into Alphabet, citing ~$200B capex on data centers/AI servers earning high returns and a cheap <17x forward earnings valuation.

Energy Transition & Power Demand▲ · 1 stocks
Berkshire Hathaway Inc
BRK-B
▲ PositiveCapitalrelevance

Berkshire's massive Alphabet stake is highlighted as one of its biggest investments, with Buffett/Abel potentially adding more.

Theme Impact 6

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