"I made a mistake": Warren Buffett finally buys Google and explains why

Change of strategy. Long resistant to technology stocks, Warren Buffett now admits he has missed a historic opportunity. The 95-year-old investor personally claims the $31 billion bet by Berkshire Hathaway on Alphabet, explaining that Google has become a very different company from the one he observed twenty years ago. For him, the revolution in artificial intelligence has transformed cloud giants into heavily capitalized companies, a model he knows by heart.

Key Points {#h-key-points}

• Warren Buffett claims he personally initiated Berkshire Hathaway's $31 billion position in Alphabet, not Greg Abel.
• The investor admits to having made "a mistake" by shunning Google and now compares hyperscalers to the railroads he has owned for decades.
• Alphabet plans up to $190 billion in capex for AI by 2026, while IBM plunges 25%, its worst session since 1968.
• Berkshire remains sitting on a record $397.4 billion in cash, with not a single bitcoin on the balance sheet despite missing out on $850 million in BTC gains.

Warren Buffett takes responsibility for his bet on Alphabet {#h-warren-buffett-takes-responsibility-for-his-bet-on-alphabet}

In an interview with CNBC, Warren Buffett wanted to clarify: Berkshire Hathaway's $31 billion stake in Alphabet is indeed his initiative, not that of Greg Abel, the conglomerate's CEO.

"I initiated it. He does nothing that I don’t approve of. We talk all the time," he stated, before acknowledging that he had long underestimated Google: "I made a mistake."

Berkshire began building its position in the third quarter of 2025 before strengthening it in recent months. Alphabet now represents the fifth or sixth largest line in the group's portfolio.

Investors have welcomed this position: Alphabet's stock rose nearly 4%, once again pushing co-founder Larry Page's fortune above $300 billion.

Mr. Buffett does not hide his optimism about the strength of the group, which he considers "more likely to be a winner than probably 90% or 95% of what is sold on Wall Street."

Why AI finally convinced Buffett {#h-why-ai-finally-convinced-buffett}

Buffett's change of perspective does not reflect an overflowing enthusiasm for artificial intelligence. On the contrary, he believes that cloud giants are engaged in an investment race from which they can no longer extricate themselves:

"The real question with Google and all its competitors now is that they are all spending hundreds of billions of dollars. (...) This is the game they are playing now. They were not playing this game with software."
Warren Buffet on AI giants -- Source: CNBC

According to him, Alphabet, Microsoft, Amazon, and Meta now resemble railroads and utilities that Berkshire has owned for decades: companies forced to invest heavily in their infrastructures to maintain their dominant position. Alphabet plans up to $185 billion in AI-related capital expenditures by 2026.

He even describes this race as "a game they don’t want to play," believing that these expenditures have become essential to remain competitive. He notably cites IBM, recently penalized in the stock market after disappointing investors, as an illustration of the risks faced by companies unable to keep up with this pace.

Finally, an essential nuance: Berkshire is not betting on Alphabet because AI is trendy, but because Google has a business model strong enough to finance this race.

Ultimately, Warren Buffett does not change his investment philosophy. He continues to favor companies capable of generating significant cash flows and maintaining a sustainable competitive advantage. If artificial intelligence is disrupting the tech sector today, it is primarily Alphabet's ability to absorb these colossal investments that justifies, in his view, a $31 billion bet.

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