Key Takeaways
- Berkshire Hathaway significantly reduced its stake in Apple stock during the first quarter, though it remains by far Berkshire's biggest stock holding.
- Based on the value of Berkshire's holdings cited in its quarterly report, the amount of shares it owns in Apple fell by about 13%, a far bigger reduction than in the previous quarter.
- Warren Buffett said at the company's annual shareholder meeting Saturday that his view on Apple hasn't changed, but noted that Berkshire is building its cash position.
- Buffett and Apple CEO Tim Cook, who is in attendance at the annual meeting, reportedly had a lengthy meeting Friday during which they discussed the reduction in Berkshire's stake.
Berkshire Hathaway (BRK.A, BRK.B) significantly cut its stake in Apple (AAPL) in the first quarter—a period during which the tech giant's stock fell sharply—as the conglomerate built its cash position.
Berkshire noted in its quarterly earnings report Saturday that the value of its Apple stock holdings stood at $135.4 billion at the end of the first quarter, compared with $174.3 billion at the end of 2024. That would indicate, taking Apple's share prices at the end of each period into account, that Berkshire cut its holdings in Apple stock by about 116 million shares, or nearly 13%, during the first quarter.
Though Apple remains by far Berkshire's largest stock holding, the latest reduction is far greater than the 10 million-share cut disclosed for the fourth quarter. Berkshire is also Apple's single largest shareholder.
Buffett Says Views on Apple Haven't Changed
Asked at the company's annual shareholder meeting whether his views about the economics of Apple's business or its attractiveness as an investment had changed, Buffett said they hadn't but acknowledged that Berkshire had sold shares.
Buffett said that American Express (AXP) and Coca Cola (KO), two of Berkshire's other large stock holdings, are wonderful businesses, and that Apple "is an even better business," noting that it's "extremely likely" that Apple will remain Berkshire's largest stock holding at the end of 2024.
At the end of 2023, Apple accounted for 50% of Berkshire's shareholdings, as the chart below shows. Berkshire first acquired Apple stock in 2016.
"We will end up—unless something dramatically happens that really changes capital allocation strategy—we will have Apple as our largest investment, but I don't mind at all under current conditions building the cash position," the Berkshire chief executive told the tens of thousands of shareholders gathered in Omaha
"I think, when I look at the alternative of what's available in equity markets and I look at the composition of what's going on in the world, we find it quite attractive," Buffett added.
Cash Holdings Likely To Grow to $200B in Q2
Berkshire said in its quarterly report that its insurance and other businesses held $182.3 billion in cash, cash equivalents and U.S. Treasury bills at the end of the first quarter, up 12% from $163.3 billion at the end of 2024.
Buffett said it's "a fair assumption" that the $182 billion figure, which does not include the $6.7 billion in cash held by Berkshire's railroad, utilities and energy businesses, will rise to about $200 billion at the end of the second quarter.
"We'd love to spend it but we won't spend it unless we think we're doing something that has very little risk and can make us a lot of money," he said.
Buffett, Apple CEO Reportedly Met Friday
CNBC reported that Buffett and Apple Chief Executive Tim Cook had spoken at length on Friday and that Cook was aware that the disclosure of the reduced stake was coming today.
CNBC's Becky Quick said she had spoken with Cook, who noted that Berkshire remains Apple's largest shareholder and that Apple remains Berkshire's largest holding, which he said he feels good about and that it's a privilege to have Berkshire as a shareholder.
After gaining nearly 50% in 2023, Apple shares fell 11% in the first quarter as investors worried about the company's sluggish growth and declining sales in China. That decline stood in sharp contrast with the 10% increase for the S&P 500 in the quarter, as well as gains for other tech giants such as Meta Platforms (META) and Amazon (AMZN).
Apple shares surged 6% on Friday, a day after the company announced better-than-expected earnings for its fiscal second quarter, driven by the strong performance of its Services business, as well as iPhone and China sales numbers that weren't as bad as feared. The company also announced a $110 billion stock buyback program, the biggest in U.S. corporate history.
Investors are now turning their attention to some key events—such as Tuesday's launch of new iPad models and the company's annual developers conference in June—for indications of what will drive the next phase of growth for Apple. They're also keen for the company to unveil details about initiatives tied to artificial intelligence, an area that Cook says is "a very key opportunity" but in which the company is seen as lagging its big tech peers.
UPDATE: This article has been updated to include information that clarifies Berkshire's total cash position at the end of the first quarter.
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