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Berkshire shares surge as Wall Street swoons amid AI fears
Berkshire Hathaway shares roared past the S&P 500 index this week as investors moved money away from slumping tech stocks and moved into what appears to be the relative safety of a traditional conglomerate with relatively little exposure to artificial intelligence amid fears massive spending on data centers won't pay off.
One month ago, Berkshire's widely held B shares were underperforming the S&P by 13.6 percentage points for the year.
With help from three more record-high closes this week, Berkshire is now 5.8 percentage points ahead of the benchmark.
Berkshire was up more than 5% this week while the S&P fell almost 2.7%.
The contrast is even sharper with the Nasdaq Composite, which fell 3.4% on the week.
Thursday's especially heavy tech selling pushed the index down more than 10% below its most recent high in what is commonly referred to as a "correction," but it did make up some of its lost ground Friday.
Two weeks ago, Berkshire's share prices completely erased all of the roughly 15% drop they suffered in the three months following Warren Buffett's surprise announcement at the 2025 shareholders meeting that he would step down as CEO at the end of that year.
Now they are up 6% from the record high closes they hit the Friday before Buffett's revelation on May 3, 2025.
Alphabet's slide cited as example of 'disappointing' stock picks
Berkshire is not completely removed from the convulsions around AI.
Abel told us in early September he sees a "significant opportunity" ahead for Berkshire Hathaway Energy to provide electricity to data centers.
He also expected Berkshire would benefit from its big bet on Google parent Alphabet, saying he and Warren Buffett knew AI was "going to have a significant impact on America and businesses," and "we saw Google as a significant player."
Now that investment is getting negative reviews this week as the stock slumps along with other companies related to AI.
As of the end of June, Berkshire reported it owned almost 106 million shares of Alphabet, including 28.6 million shares it bought directly from the company in June: $5 billion of its Class A shares (GOOGL) for $351.81 each and another $5 billion of Class C shares (GOOG) for $348.20 each.
They are around $284 per share now.
It bought another $7 billion of Alphabet shares on the open market during the second quarter, adding to the position it started building in last year's third quarter, an investment initiated by Warren Buffett.
Bloomberg suggests that "with cracks in the AI trade starting to show, Berkshire's sudden push [into AI] may appear ill-timed."
On June 30, the position had a market value of $37.8 billion and it was the third largest equity holding in Berkshire's portfolio.
Since then both the Class A and Class C shares have dropped by around 20% and the stake is now valued at $30.2 billion, falling behind Coca-Cola's $38.3 billion to the portfolio's #4 position.
(In just over a week, we'll find out whether Berkshire made any changes to its Alphabet position during the third quarter ending September 30.)
Bloomberg quotes CFRA Research analyst Cathy Seifert as saying, "I do think that part of this may be a conscious decision to increase their exposure. One has to ask the question though, is it a little late?"
But the article notes that "for dedicated value investors and longtime Berkshire observers, such jitters may not really matter," with Keefe Bruyette & Woods analyst Meyer Shields saying Abel probably sees bets on AI as a long-term wager on the technology's potential, in keeping with the "conservatism that you would expect at Berkshire Hathaway."
A drone view shows a data center at the Google Storey County Campus in the Tahoe-Reno Industrial Center in Sparks, Nevada, Oct. 9, 2026. Hyperscaler spending on AI data centers has fueled a rise in tech sector bond issuance.Daniel Cole | ReutersAt Barron's, however, Andrew Bary sees what he estimates is a $3 billion loss on Alphabet as part of a "disappointing" long-term trend in Berkshire's stock choices
"The company hasn't created much value from stock picking during the current decade" even though the "S&P 500 has returned 150% since the end of 2019 and tech stocks have quadrupled."
While Berkshire's investments in five Japanese "trading houses," Chevron, and Chubb have done well, "there have been plenty of losers or simply mediocre investments that have been closed out."
He cites Verizon, HP, Paramount (now Skydance), General Motors, Constellation Brands, and Pool.
While he estimates Berkshire's Occidental Petroleum investment is up about 20% from what it paid, OXY is "far behind most energy stocks" amid this year's big increase in crude prices.
Bary also lists stocks that have continued to rise in price after Berkshire cut its stakes, with Apple being the worst offender.
That stake has been reduced by 75% since 2023 at what Bary calculates is an average selling price around $200 per share, well below AAPL's current $342.
Despite those sales, Apple is Berkshire's largest equity holding with a market value of $78 billion. The stock is up 1200% since Berkshire started buying it at the beginning of 2016, at a time when many thought the company had already seen its best days.
Bary thinks Abel will probably keep Berkshire's core equity investments but may concentrate more on his strengths going forward: improving Berkshire's operating companies and making new acquisitions.
His conclusion: "Barring a market rout, equity investing may not be central to Berkshire anymore.
"And if any new Berkshire holdings are revealed soon, it may not be a good idea to buy them. The record hasn't been great."
Small buy helps lift Sirius XM shares
Berkshire Hathaway's disclosure that it had made a relatively small $27 million addition to its $4.1 billion Sirius XM position helped fuel an ongoing rally that lifted the satellite radio company's shares to a 52-week high this week.
On Thursday morning last week, Sirius XM reported a 14% increase in its Q3 free cash flow, 5,000 more self-pay subscribers, and it raised its 2026 full-year financial guidance.
The stock ended 4.9% higher that day at $28.67.
On Friday, Monday, and Tuesday, Berkshire bought more than 924 thousand shares at an average price of $29.10 as the stock continued to gain ground, ending Tuesday at $30.80.
Berkshire disclosed the buys late Tuesday evening, apparently helping to fuel an additional 8.4% gain as the stock closed at $33.40 on Wednesday.
It hit a 52-week intraday high of $33.76 on Thursday but finished lower Friday at $32.40.
Overall, Sirius XM is up 18.6% since the earnings release and has gained 62.0% so far this year.
It's the first addition to Berkshire's stake since late-July and early-August last year.
In 2025, it bought a total of 7.3 million shares at an average price of $21.86.
The position is likely one of portfolio manager Ted Weschler's stocks.
Berkshire utility asks for 57% rate hike in Northern California
Pacific Power, a unit of Berkshire Hathaway's PacifiCorp, is asking California regulators for a 57% rate increase that would raise the typical residential electric bill by $120 a month.
The Wall Street Journal calls it a "stunning request even in an era of rising electricity costs."
The utility says the hike would be partially offset by a 14% decrease taking effect on January 1.
A lot of the $103 million that would be generated by the increase is already being spent on efforts to make power equipment in the sparsely populated and heavily wooded area more resistant to wildfires.
The utility is facing around $637 million in liability claims for fires in 2020 and 2022.
This week, Reuters reports, Oregon's Supreme Court heard arguments on whether to revive a jury verdict that could expose PacifiCorp "to tens of billions of dollars of potential damages over its role in four Oregon wildfires in 2020."
BUFFETT & BERKSHIRE AROUND THE INTERNET
Some links may require a subscription:
- Fortune on MSN: Tech stocks just lost more than $1 trillion in a day—a gothic horror test for the moats Warren Buffett taught Wall Street to love
HIGHLIGHTS FROM CNBC'S BUFFETT ARCHIVE
Work in the age of artificial intelligence (2017)
Warren Buffett and Charlie Munger share their opinions about how artificial intelligence could affect the economy, the government, and how much time people spend on leisure activities.
watch nowVIDEO2:4402:44Work in the age of artificial intelligence2017 Berkshire Hathaway Annual MeetingANDREW ROSS SORKIN: Thomas Kimay (PH) is here. He's a 27-year-old shareholder from Kentfield, California.
And I should preface this question by saying that he was here 17 years ago at 10 years old, asked you a question from the audience asking you if the internet might hurt some of Berkshire's investments.
At the time, you said you wanted to see how things would play out. He's now updated the question. (Buffett laughs)
"What do you think about the implications of artificial intelligence on Berkshire's businesses, beyond autonomous driving and GEICO, which you've talked about already? ...
WARREN BUFFETT: I certainly have no special insights on artificial intelligence, but I will bet a lot of things happen in that field in the next couple of decades, and probably a shorter timeframe.
They should lead, I would certainly think — but again, I don't bring much to this party. But I would certainly think they would result in significantly less employment in certain areas.
But that's good for society.
And it may not be good for a given business, but let's take it to the extreme.
Let's assume one person could push a button and, essentially, through various machines and robotics, all kinds of things, turn out all of the output we have in this country.
So, everybody's — there's just as much output as we have. It's all being done by, you know, instead of 150-some million people being employed, one person.
You know, is the world better off or not?
Well, certainly we'd work a lot less hours a week — of work per week and so on.
I mean, it would be a good thing, but it would require enormous transformation in how people relate to each other, what they expect of government, you know, all kinds of things. And, of course, as a practical matter, more than one person would keep working.
But pushing the idea that way is one of the — you'd certainly think that's one of the consequences of making great progress in artificial intelligence.
And that's enormously prosocial, eventually. It's enormously disruptive in other ways. And it can have huge problems, in terms of a democracy and how it reacts to that...
CHARLIE MUNGER: Well, you're painting a very funny world where everybody's engaged in trade. And the trade is, I give you golf lessons and you dye my hair. And that would be a world kind of like the royal family of Kuwait or something.
And I don't think it would be good for America to have everything produced by one person and the rest of us just engaged in leisure.
BERKSHIRE STOCK WATCH
Four weeks
Twelve months
BRK.A stock price: $856,612.00
BRK.B stock price: $570.89
BRK.B P/E (TTM): 14.35
Berkshire market capitalization: $1,222,245,324,463
Berkshire Cash as of June 30: $365.5 billion (Down 8.0% from March 31)
Excluding Rail Cash and Subtracting T-Bills Payable: $359.2 billion (Down 3.8% from March 31)
Berkshire repurchased $4.5 billion of its shares in Q2 2026.
BERKSHIRE'S TOP EQUITY HOLDINGS - Nov. 6, 2026
Berkshire's top holdings of disclosed publicly traded stocks in the U.S. and Japan, by market value, based on the latest closing prices.
Holdings are as of June 30, 2026, as reported in Berkshire Hathaway's 13F filing on August 14, 2026, except for:
- Mitsubishi, which is as of April 30, 2026
The full list of holdings and current market values is available from CNBC.com's Berkshire Hathaway Portfolio Tracker.
QUESTIONS OR COMMENTS
Please send any questions or comments about the newsletter to me at alex.crippen@cnbc.com. (Sorry, but we don't forward questions or comments to Buffett himself.)
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-- Alex Crippen, Editor, Warren Buffett Watch
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