Key Takeaways
- Warren Buffett’s Berkshire Hathaway increased its Alphabet holdings by nearly 3x, reaching 58 million shares valued at approximately $16.6 billion — now among its top-five positions.
- The substantial purchase came as Alphabet shares experienced a 6% decline, with the stock currently valued at a forward P/E ratio of 25x — underneath the broader S&P benchmark.
- First-quarter 2026 results showed Alphabet generating $109.9 billion in revenue, representing 21.8% annual growth, while Google Cloud’s contracted backlog surged to $460 billion — nearly double the previous quarter.
- Pershing Square’s Bill Ackman executed the opposite strategy, liquidating more than 95% of his Alphabet shares to reallocate funds into Microsoft, which has fallen approximately 20% this year.
- Bridgewater Associates led by Ray Dalio joined Berkshire in accumulating Alphabet shares, while both Donald Trump and Nancy Pelosi revealed purchases made in early 2026.
Warren Buffett’s investment vehicle has executed one of its most significant technology sector moves in recent memory — placing a massive wager on the company behind the world’s dominant search engine.
Recently filed Q1 2026 13F disclosures revealed that Berkshire Hathaway expanded its Alphabet ownership to approximately 57.8 million shares, representing a portfolio value of roughly $16.6 billion. This aggressive accumulation pushed Alphabet into Berkshire’s elite top-five holdings — a notable development for an investment firm famous for its methodical, patient approach.
Shares of Alphabet have surged 115% over the trailing twelve months and gained 15% year-to-date. However, a recent 6% monthly decline created an attractive entry opportunity for Berkshire’s team. The company’s current forward P/E multiple of 25x sits beneath the S&P 500’s average valuation — a pricing inefficiency that typically attracts value-focused institutional investors.
Berkshire CEO Greg Abel and his investment team apparently built their investment thesis around Alphabet’s impressive first-quarter performance. The company reported $109.9 billion in quarterly revenue, representing 21.8% year-over-year expansion. Earnings per share reached $5.11, crushing analyst expectations of $2.63. Google Cloud’s segment grew 63%, while its contracted revenue backlog exploded to over $460 billion — nearly doubling from the prior quarter.
This backlog metric deserves particular emphasis. Unlike projections or guidance, this represents legally binding future commitments. For Berkshire’s characteristic preference for predictable, contractual cash generation, this statistic likely proved compelling.
Ray Dalio’s Bridgewater Associates similarly expanded its Alphabet position during this timeframe. Interestingly, both former President Donald Trump and Congresswoman Nancy Pelosi filed disclosures showing Alphabet purchases executed in early 2026.
Ackman Executes Opposite Strategy with Microsoft
While Berkshire accumulated shares, billionaire investor Bill Ackman pursued a dramatically different path.
Ackman’s Pershing Square fund liquidated over 95% of its Alphabet stake, redirecting those proceeds into Microsoft stock. Microsoft shares have declined approximately 20% year-to-date, currently trading near $378.90 compared to Wall Street’s consensus price target of $565.90.
Ackman’s investment rationale centers on Microsoft’s artificial intelligence expansion. The tech giant’s AI-related business now operates at a $37 billion annual run rate, expanding 123% year-over-year. Azure cloud services posted 40% quarterly growth. Microsoft’s commercial remaining performance obligation totaled $627 billion, doubling annually with 99% growth.
Microsoft also maintains a restructured ownership stake in OpenAI — approximately 27%, currently valued near $135 billion — alongside intellectual property licensing rights extending through 2032. Ackman is accumulating shares at a forward P/E below 20x following substantial price depreciation.
Contrasting Approaches to AI Investment
Both investment strategies fundamentally represent artificial intelligence exposure, executed through different corporate vehicles.
Berkshire’s approach emphasizes Google Cloud’s infrastructure positioning and the substantial contracted revenue visibility supporting it. Ackman’s thesis focuses on Microsoft’s enterprise software dominance and its strategic OpenAI relationship.
Wall Street analyst price targets illustrate the divergent market sentiment. Alphabet carries a consensus target of $417. Microsoft’s consensus stands at $565.90 — significantly above current trading levels.
Sundar Pichai commented on Q1 results, saying: “Our AI investments and full stack approach are lighting up every part of the business.”
Alphabet has delivered 115% returns over the past twelve months. Microsoft has fallen roughly 20% during the identical timeframe.
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