World’s biggest investor Warren Buffet, has been known for avoiding technology stocks, has revealed that he personally initiated Berkshire Hathaway’s $31 billion investment in Google, marking a rare pivot into Silicon Valley. Speaking in an interview to CNBC, Buffet said Google’s massive capital expenditure on AI infrastructure finally convinced him to buy in. “The real question with Google and all of its competitors now, because they’re all laying out hundreds of billions, and… that’s real money,” he noted.Buffet explained that Google’s spending spree which is more than $100 billion annually on data centers and chips resembles the capital-intensive businesses he has owned for decades, such as railroads and utilities. “They don’t have any choice,” he said, describing hyperscalers’ AI race as a game they are compelled to play. He admitted passing on Google earlier was a mistake, but said the new spending model made the company understandable to him. Despite praising Alphabet, Buffett said Apple remains one of Berkshire Hathaway’s favourite investments and that its “future is as bright as the past.”
Why Alphabet over rivals
When asked why he chose Google-parent Alphabet instead of Amazon or Microsoft, Buffet declined to criticise the competitors but suggested that tech giant Google is “more likely to be a winner based on the record than probably 90% or 95% of what gets merchandised through Wall Street.” He also emphasised that the AI spending race as closer to a trap than a guaranteed victory, citing IBM’s historic struggles as a cautionary tale.Shares of Alphabet shares surged nearly 4% this week, pushing co-founder Larry Page’s net worth above $300 billion for only the second time. Berkshire’s stake, now its fifth- or sixth-largest holding, added $8 billion to Page’s fortune after Buffett’s comments. The buying accelerated this year, with Berkshire spending an additional $10 billion last month.Berkshire Hathaway first disclosed its investment in Alphabet in November last year, when it purchased more than 17.8 million shares worth about $4.3 billion. The investment firm later increased its holding by buying an additional 40 million shares, taking its total ownership to around 58 million shares. That investment is now worth about $21 billion.
Google’s own concerns
On Google’s Q4 earnings call in February, CEO Sundar Pichai acknowledged the risks of converting billions in AI investment into usable compute infrastructure, admitting the spending keeps him up at night. Still, he struck an optimistic tone: “We are in a very, very relentless innovation cadence, and I think we are confident about keeping that momentum as we go through 2026.”
