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Warren Buffett's Berkshire Hathaway gambles on Alphabet

(Sharecast News) - Shares in Google-parent Alphabet sparked on Monday, after Warren Buffett's Berkshire Hathaway took a stake in the US tech firm. A filing late on Friday showed the closely-followed investment giant had acquired 17.85m shares as of 30 September.

According to calculations by Reuters, the holding is worth $4.93bn based on Friday's closing price.

As at noon GMT on Monday, the stock had put on 5% in pre-market trading.

Tech stocks have soared recently as investors look to cash in on the artificial intelligence boom. Strong demand for AI has boosted Alphabet's cloud business and its stock has put on 45% so far this year. However, it remains more modestly priced than others in the sector.

The move could potentially be one of the last major investments Berkshire Hathaway makes under Buffett, 94, the so-called Sage of Omaha.

The famed stock picker - who has overseen unprecedented success during his 60-year run as chief executive, as well as becoming a multi-billionaire - is stepping down at the end of 2025. He is being replaced by Greg Abel. The 62-year-old has been vice chair since 2018.

Berkshire Hathaway is not generally known for its fast-growth, tech investments. It holds a sizeable stake in Apple, but Buffett has long insisted the company is a consumer products specialist rather than a pure tech play.

It currently holds around $64.9bn of Apple's stock, making it its largest holding, but is also heavily focused on the financial services sector.

After Apple, its next biggest holdings are American Express, Bank of America and Coca-Cola.

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Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.