Berkshire Hathaway's Strategic Tech Shift: Investing in Alphabet

Berkshire Hathaway has invested in Alphabet, with its shares up 5.5% following the announcement. This move could be one of Warren Buffett's last major decisions as he steps down as CEO in 2025, marking a shift from Berkshire's traditional avoidance of tech stocks.

In a significant strategic shift, Berkshire Hathaway has disclosed a substantial investment in Alphabet, sending the tech giant's shares climbing 5.5% in premarket trading on Monday. The filing, reported last Friday, reveals that Berkshire holds 17.85 million shares in Google's parent company, a stake valued at $4.93 billion as of the latest closing price.

The investment stands out against a backdrop of growing scrutiny over Big Tech's hefty spending on artificial intelligence. This development comes shortly after Michael Burry, famed for his accurate predictions in "The Big Short," decided to deregister his hedge fund following his critical stance on leading AI companies. Berkshire's shift into tech marks one of the last major decisions under the guidance of Warren Buffett, who plans to retire as CEO in 2025, with Greg Abel slated to succeed him.

While it remains unclear who specifically executed the purchase—whether it was Buffett himself, portfolio managers Todd Combs and Ted Weschler, or his successor Abel—the move signals a noteworthy departure from Berkshire's historical hesitance toward tech stocks. Traditionally, the conglomerate has steered clear of such investments, with Buffett previously defining its largest stake, Apple, as more of a consumer products company than a tech entity.

(With inputs from agencies.)