Key Takeaways
- Berkshire Hathaway expanded its Alphabet holdings to approximately 58 million shares valued at $16.6 billion, elevating it to a top-five portfolio position.
- The acquisition came after Alphabet shares declined 6%, with the tech giant trading at a forward P/E ratio of 25x — beneath S&P benchmarks.
- First quarter 2026 results showed Alphabet revenue reaching $109.9 billion, representing 21.8% annual growth, while Google Cloud’s contracted backlog surged to $460 billion.
- Pershing Square’s Bill Ackman liquidated over 95% of his Alphabet holdings, redirecting capital toward Microsoft shares currently down approximately 20% this year.
- Bridgewater’s Ray Dalio joined Berkshire in accumulating Alphabet, with both President Trump and Representative Pelosi reporting similar purchases in early 2026.
Warren Buffett’s investment vehicle has executed one of its most substantial strategic moves in recent memory — targeting the tech titan behind Google.
First quarter 2026 regulatory 13F disclosures revealed Berkshire increased its Alphabet holdings to approximately 57.8 million shares, representing roughly $16.6 billion in market value. This dramatic expansion pushed Alphabet into Berkshire’s elite top-five holdings, a remarkable development for an institution famous for its measured approach.
Alphabet shares have surged 115% over the trailing twelve months and climbed 15% year-to-date. However, a recent 6% monthly decline created an attractive entry point for Berkshire’s accumulation. The company’s current forward P/E multiple of 25x sits comfortably below S&P 500 averages — a valuation metric that typically resonates with value-focused institutional investors.
Berkshire CEO Greg Abel’s investment team likely built their thesis around Alphabet’s impressive Q1 performance metrics. Total revenue reached $109.9 billion, marking 21.8% year-over-year expansion. Earnings per share landed at $5.11, substantially exceeding the consensus forecast of $2.63. Google Cloud’s segment delivered 63% growth, while its contracted backlog nearly doubled sequentially to exceed $460 billion.
This backlog metric deserves special attention. Unlike projections or guidance, these represent signed commitments for future services. For an investment firm like Berkshire that prioritizes dependable cash generation, such concrete future revenue visibility holds significant analytical value.
Ray Dalio’s Bridgewater Associates simultaneously increased its Alphabet exposure during this timeframe. Separately, former President Trump and House Representative Nancy Pelosi both filed disclosures showing Alphabet acquisitions in early 2026.
Ackman’s Strategic Rotation into Microsoft
As Berkshire aggressively accumulated shares, Bill Ackman executed the opposite maneuver.
Ackman’s Pershing Square liquidated over 95% of its Alphabet stake, reallocating those proceeds into Microsoft. Microsoft shares have declined approximately 20% year-to-date, currently changing hands around $378.90 versus analyst consensus targets of $565.90.
Ackman’s investment thesis centers on Microsoft’s artificial intelligence trajectory. The company’s AI-related business now generates $37 billion in annual run rate, expanding 123% year-over-year. Azure cloud infrastructure posted 40% quarterly growth. Microsoft’s commercial remaining performance obligation totaled $627 billion, up 99%.
Microsoft maintains a restructured equity position in OpenAI — approximately 27%, valued near $135 billion — with intellectual property licensing extended through 2032. Ackman is establishing this position at a forward P/E below 20x following a significant valuation compression.
Contrasting Approaches to AI Investment
Both transactions fundamentally represent artificial intelligence investments, merely through different strategic lenses.
Berkshire is positioning behind Google Cloud’s infrastructure capabilities and the substantial contracted demand underpinning it. Ackman is wagering on Microsoft’s enterprise software dominance and its strategic OpenAI alliance.
Analyst price targets illuminate the divergent market sentiment. Alphabet carries a consensus target of $417. Microsoft’s consensus reaches $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 appreciated 115% over the past year. Microsoft has declined approximately 20% over the identical period.
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