Buffett quietly bought the dip: sold Apple to buy Google, this time he is targeting "cheap" AI stocks.

Buffett's New Moves

Berkshire Hathaway's Q3 financial report revealed an interesting signal: while the old man significantly reduced his stake in Apple, he suddenly entered Google (Alphabet).

The specific numbers are as follows:

• Apple holdings shrank another 15%, down to 238 million shares (market value of $60.6 billion), still the largest position.
• Google has established a new position of 17.8 million shares, investing $4.3 billion, accounting for 1.6% of the investment portfolio.

Why cut apples?

Since the beginning of 2023, Berkshire has cut its position in Apple by 74%—which essentially confirms that it is looking to exit entirely. Buffett has stated that they either buy everything or sell everything, and do not engage in “tweaking”.

Where is Apple's problem? Tariff pressure + lack of AI strategy. Investors have been complaining about Apple's slow response to the AI wave, which may have struck a chord with the old man.

Why suddenly look at Google?

This is the core - valuation is cheap.

AI concept stocks are generally overvalued, but Google's forward PE is the lowest among the Magnificent Seven, even just a fraction of Tesla's valuation. This is precisely the “value investing” strategy of Berkshire.

1. The moat of the search business is deep: 90% market share, the threat of AI large models has already been digested.
2. Diversified Approach: YouTube, Autonomous Vehicles (Waymo), Cloud Computing, Self-Developed Chips
3. AI Output is Solid: Google Overviews and AI Mode performed well, and market recognition is rebounding.
4. Antitrust risks have also been mitigated: The court did not force the split of Chrome, and Google's continued collaboration with Apple has also been approved.

Looking at it from a different angle

This is not Buffett being optimistic about AI, but rather he is diminishing the valuation bubble of AI stocks. While others are chasing high-tech giants, he instead buys the one with the coldest valuation at the hottest time for AI — this is the obsession of a value investor in his 80s.