New CEO Accelerates Capital Deployment as Berkshire Ends Long Stock-Selling Streak
Berkshire Hathaway is putting more of its enormous cash reserves to work under new Chief Executive Officer Greg Abel, significantly increasing its stakes in Alphabet and Delta Air Lines during the second quarter while reducing several long-held positions.
The investment moves provide one of the clearest indications yet of how Berkshire’s capital-allocation strategy is evolving following Warren Buffett’s transition from chief executive to chairman.
Berkshire increased its Alphabet holdings by 83% to nearly 106 million shares, worth about $37.8 billion at the end of June, making the Google parent the conglomerate’s third-largest stock investment behind Apple and American Express.
The company also increased its position in Delta Air Lines by about 44%, while adding to several housing-related investments.
Alphabet Becomes a Major Berkshire Holding
The biggest change in Berkshire’s portfolio was its increased investment in Alphabet.
The conglomerate added tens of millions of Alphabet shares during the quarter, building the position into one of its most important public-equity investments.
The move follows Berkshire’s earlier investment in Alphabet and a $10 billion purchase connected to the company’s AI infrastructure expansion.
Alphabet’s growing importance to Berkshire reflects the company’s transformation from primarily an internet-search business into a broader technology company with major operations in cloud computing and artificial intelligence.
For Berkshire, the investment provides exposure to one of the world’s largest technology platforms while maintaining the conglomerate’s preference for companies with substantial cash generation and established businesses.
AI Is Increasingly Important to Berkshire’s Portfolio
Alphabet’s expansion within Berkshire’s portfolio also highlights the growing importance of artificial intelligence.
Alphabet is investing heavily in AI infrastructure, computing capacity and data centers as it competes with other major technology companies.
Google Cloud has become an increasingly important source of growth, while Google’s AI models and products are being integrated across its ecosystem.
Berkshire’s willingness to commit billions of dollars to Alphabet suggests that the company sees the AI transformation as an opportunity rather than simply a source of market speculation.
The investment also represents a notable evolution from Berkshire’s historically cautious approach to large technology holdings.
Delta Stake Gets a Significant Increase
Berkshire also increased its position in Delta Air Lines by 44%, bringing its holding to roughly 57 million shares.
The airline investment indicates confidence in continued strength in the US travel market and Delta’s ability to generate earnings from premium travel demand.
Airlines can be highly sensitive to fuel prices, consumer spending and economic cycles, making the position different from Berkshire’s traditional holdings in insurance, consumer goods and financial services.
However, Delta has developed a strong premium-travel business and significant loyalty-program operations.
The larger stake suggests Berkshire sees value in the company’s long-term earnings potential.
Berkshire Returns to Net Stock Buying
The portfolio changes are particularly significant because they represent a major departure from Berkshire’s recent investment behavior.
During the second quarter, Berkshire bought approximately $23.5 billion of stocks and sold about $3.7 billion, ending a streak of 14 consecutive quarters of net stock selling.
The shift demonstrates that Berkshire is becoming more willing to deploy capital into public markets.
That is especially important because the company had accumulated an enormous cash position during Buffett’s final years as CEO.
For years, Buffett had emphasized patience and argued that Berkshire should wait for attractive opportunities rather than invest simply because it had cash available.
Cash Reserves Decline
Berkshire’s cash and Treasury holdings fell to about $364.7 billion at the end of June, down from approximately $380.2 billion at the end of the first quarter.
The decline reflects the company’s increased stock purchases as well as share repurchases.
Although the cash pile remains enormous, the reduction signals that Berkshire is no longer simply accumulating liquidity.
Abel is beginning to put a portion of that capital to work.
Share Buybacks Return
Berkshire also spent about $4.5 billion buying back its own shares during the quarter.
The buybacks are significant because they indicate management believes Berkshire’s own stock can represent an attractive use of capital.
Repurchasing shares reduces the number of outstanding shares and can increase the ownership percentage of remaining shareholders.
The latest buyback activity was Berkshire’s largest since 2021, according to reports.
Homebuilding Becomes Another Focus
Berkshire’s investment activity was not limited to technology and airlines.
The company expanded its exposure to the US housing market, adding shares of Lennar and opening a small position in D.R. Horton.
The moves came shortly before Berkshire completed its roughly $6.8 billion acquisition of homebuilder Taylor Morrison, further demonstrating its growing interest in residential construction.
The housing investments suggest Berkshire sees opportunities in a sector facing a structural shortage of homes in many parts of the United States.
Macy’s Position Also Expands
Berkshire also increased its position in Macy’s, more than doubling the number of shares held during the quarter.
The move represents a smaller investment compared with Alphabet and Delta but shows that Berkshire continues to search for opportunities across different parts of the US economy.
Macy’s remains a mature retail company with significant real-estate assets, giving Berkshire another potential value-oriented investment.
Berkshire Cuts Several Financial Positions
While Berkshire was buying aggressively in some areas, it also reduced several existing holdings.
The company cut its Bank of America stake by about 30.2 million shares, reducing its position by roughly 6%.
It also reduced investments in Capital One, Kroger, Nucor, Ally Financial and DaVita.
The reductions indicate that Berkshire’s new buying strategy does not represent a broad-based decision to purchase stocks indiscriminately.
Instead, the company is reallocating capital toward investments it believes offer better opportunities.
Constellation Brands Position Ends
Berkshire also completely exited its investment in Constellation Brands.
The decision ends a relatively recent position in the beverage company and illustrates the willingness of Berkshire’s investment team to abandon holdings when the underlying investment case changes.
The exit also contrasts with the company’s aggressive purchases of Alphabet and housing stocks.
Abel’s Berkshire Is Taking Shape
The latest portfolio changes provide an early look at Berkshire under Abel.
Although Buffett remains chairman and continues to have an influence on major capital decisions, Abel is now responsible for running the company as CEO.
The second-quarter investment activity suggests that Abel is comfortable using Berkshire’s financial resources more aggressively than the company did during Buffett’s final years as chief executive.
That does not mean Berkshire is abandoning its traditional philosophy.
The company continues to emphasize businesses with strong financial positions, durable competitive advantages and long-term earnings potential.
Buffett’s Influence Remains
The Alphabet investment also illustrates that the transition from Buffett to Abel is not a complete break with the past.
Buffett was reportedly involved in initiating Berkshire’s Alphabet investment before stepping down as CEO.
Abel has subsequently expanded the position significantly.
That suggests the company’s investment philosophy is evolving gradually rather than undergoing an abrupt transformation.
Berkshire Still Has an Enormous Cash Cushion
Even after spending billions of dollars, Berkshire retains one of the largest corporate cash reserves in the world.
The roughly $365 billion cash and Treasury position gives Abel enormous flexibility.
Berkshire can continue making acquisitions, purchasing stocks, repurchasing its own shares or waiting for more attractive opportunities.
That financial flexibility is one of the company’s most important competitive advantages.
Markets Will Watch Abel’s Next Moves
Investors are likely to pay close attention to Berkshire’s next portfolio filing.
The second quarter showed that Abel is prepared to deploy significant amounts of capital when he sees attractive opportunities.
The question now is whether the increased buying represents the beginning of a longer-term shift or simply a period in which Berkshire found several unusually attractive investments.
Alphabet’s performance, the housing market and consumer spending will all influence whether these new positions deliver the returns Berkshire expects.
Looking Ahead
Berkshire Hathaway’s latest portfolio moves mark an important turning point for the company as Greg Abel begins putting more of its enormous cash reserves to work.
The conglomerate increased its Alphabet position by 83% to nearly 106 million shares, making the technology company Berkshire’s third-largest stock investment at the end of June.
Berkshire also increased its Delta Air Lines holding by 44% and expanded positions in Lennar, Macy’s and other companies.
The most important change, however, may be Berkshire’s return to net stock buying.
After 14 consecutive quarters in which Berkshire sold more equities than it purchased, the company bought approximately $23.5 billion of stocks during the second quarter while selling about $3.7 billion.
That shift helped reduce Berkshire’s cash reserves from roughly $380 billion to $365 billion.
The company also spent about $4.5 billion on share repurchases, reinforcing the impression that Abel is more willing to deploy Berkshire’s capital when he sees opportunities.
Alphabet represents the clearest example of the new approach.
The investment gives Berkshire greater exposure to artificial intelligence, cloud computing and one of the world’s most powerful technology businesses.
At the same time, the increased Delta position and investments in homebuilders show that Berkshire’s strategy remains diversified.
Abel is not simply replacing Buffett’s portfolio with technology stocks.
Instead, he appears to be combining Berkshire’s traditional value-oriented approach with opportunities created by changing consumer behavior, technology and housing demand.
The company still retains an enormous financial cushion, meaning the latest purchases are unlikely to represent the end of its capital-deployment strategy.
The bigger question is how aggressively Berkshire will continue using that cash under Abel.
If the new CEO can identify attractive investments while maintaining Berkshire’s financial strength, the company’s huge cash pile could become a powerful source of future growth.
For now, Berkshire’s latest moves offer investors an early glimpse of the company after Buffett: still disciplined, still selective, but increasingly willing to put its money to work.
