Berkshire Puts Cash to Work in Alphabet as Abel Sets His Own Course

Since taking over as chief executive of Berkshire Hathaway in January, Greg Abel has started deploying the company's cash reserves of nearly 400 billion dollars, and the Economic Times reported that Alphabet, the parent of Google, sits at the center of that strategy. The move invites comparison to the large position in Apple that his predecessor, Warren Buffett, developed into one of Berkshire's most profitable holdings.

The choice is a statement about how a value-oriented investor now views the technology giants. Buffett long treated most technology companies as too unpredictable to own, before making an exception for Apple on the grounds that it functioned as a consumer franchise with durable pricing power. An Alphabet position extends that logic to a company whose search and advertising business generates large, steady cash flows, and whose spending on artificial intelligence is now a central question for investors.

The bet also reflects where Berkshire's enormous cash balance can go. Deploying a sum near 400 billion dollars requires targets large and liquid enough to absorb it, which narrows the field to the biggest companies. That constraint is itself a feature of a market in which value and capital keep concentrating in a handful of mega-cap technology firms.