Warren Buffett’s Berkshire Hathaway has reduced its stake in tech giant Apple by nearly 50%, as reported in the company’s second quarter earnings released on Saturday. The company disclosed that its holdings in Apple were valued at $84.2 billion at the end of the quarter, down from 790 million shares to 400 million shares. This significant selloff is unusual for Buffett, who typically holds onto stocks for long periods of time. Apple did not provide a response to requests for comment on the matter.
This is not the first time Berkshire Hathaway has downsized its stake in Apple, a company with a market cap of over $3.3 trillion. In the final three months of 2023, Berkshire sold off 10 million shares of Apple stock, representing about 1% of its total holdings in the company. Furthermore, in the first quarter of 2024, Berkshire reduced its stake in Apple by 13%. However, despite the reduction in Apple shares, Berkshire Hathaway reported a record cash pile of nearly $277 billion for the second quarter, up from $189 billion in cash and equivalents in the first quarter.
In addition to reducing its stake in Apple, Berkshire Hathaway also sold off $75.5 billion in stock in the second quarter. This included cutting its stake in its second largest position, Bank of America, which now stands at $41.1 billion. The earnings report revealed that approximately 72% of Berkshire’s aggregate fair value is concentrated in five companies: American Express ($35.1 billion), Apple ($84.2 billion), Bank of America ($41.1 billion), Coca-Cola ($25.5 billion), and Chevron ($18.6 billion).
Overall, the reduction in Berkshire Hathaway’s stake in Apple signifies a shift in Buffett’s investment strategy. While he is known for holding onto stocks for extended periods, the recent selloff indicates a change in approach. The company’s record cash pile and reduction in stock holdings demonstrate a strategic decision to reallocate funds and perhaps diversify its portfolio. It will be interesting to see how Berkshire Hathaway’s investment strategy evolves in the coming quarters and how its actions impact the overall market.
