Key Takeaways:
Berkshire Hathaway sold Bank of America shares for an eighth consecutive quarter while building Alphabet into its third-largest holding, the clearest sign yet that Greg Abel's capital-allocation playbook differs from the Buffett era. The moves come as Abel, who took over the $357 billion equity portfolio after Warren Buffett retired Dec. 31, shifts Berkshire toward a virtual-monopoly tech asset and away from a major banking exposure.
"Alphabet's dominance — Google Search commands an estimated 89 to 93 percent of the global market — makes it a natural fit for a portfolio built on durable moats," said Sarah Lin, a New York-based equities analyst who tracks US large caps. "The question is whether the timing, with Alphabet's AI-driven capex surging, matches Berkshire's historical preference for buying at a margin of safety."
The Alphabet stake swelled to roughly $38 billion in the second quarter, displacing Coca-Cola from the No. 3 slot. Berkshire added about 48 million shares worth approximately $16.3 billion, including a $10 billion private placement announced in June. The buildup was part of a broader swing to net buying: Berkshire purchased $23.5 billion of stock while offloading $3.7 billion, ending fourteen consecutive quarters of net selling. Other additions included Delta Air Lines, Lennar, Macy's and the New York Times, while Berkshire trimmed DaVita, Kroger, Ally Financial and Capital One alongside Bank of America.
The sell-down of Bank of America, which has now run for two years, reflects profit-taking and a deliberate reduction of banking exposure, analysts said. Underlying operations delivered a solid quarter: operating earnings climbed 16 percent to $12.98 billion, beating the $5.13 per Class B share consensus with an actual $6.02. Manufacturing, service and retailing profits jumped 24 percent to $4.47 billion, Berkshire Hathaway Energy improved 27 percent to $891 million, and the BNSF railroad advanced 6 percent to $1.56 billion. Insurance underwriting income, however, fell 13 percent to $1.73 billion, while investment income from insurance slipped 9 percent to $3.06 billion.
The repositioning carries risk. Alphabet sits in the middle of a capital-spending debate, with CEO Sundar Pichai lifting the 2026 capex forecast to as much as $205 billion from a prior $180 billion to $190 billion range; the stock shed 7 percent after the announcement and trades roughly 16 percent below its peak. Berkshire's cash pile stood at $365.5 billion as of June 30, with second-quarter buybacks of $4.5 billion well below earlier paces. The shift toward technology and housing — including the closed $6.8 billion Taylor Morrison acquisition — introduces new volatility into a holding many investors treat as ballast. Abel's September visit to Japan's five trading houses will offer the next read on where he plans to deploy Berkshire's cash.
