In a surprising move, Warren Buffett’s Berkshire Hathaway has dramatically reduced its stake in Apple, selling off nearly half of its investment in the tech giant last quarter. The company disclosed in its earnings filing that its remaining Apple holdings were valued at $84.2 billion at the end of Q2, indicating that Berkshire offloaded just over 49% of its Apple stake.
Despite this significant reduction, Apple remains Berkshire Hathaway’s largest stock investment by a considerable margin. The decision to sell Apple shares comes as part of a broader trend of divesting equities, with Berkshire unloading over $75 billion in stocks during the same period. This has raised the conglomerate’s cash reserves to a record $277 billion.
Buffett had previously trimmed Berkshire’s Apple stake by 13% in Q1, citing tax reasons. At the Berkshire annual meeting in May, Buffett suggested that further reductions could be advantageous if future U.S. tax policies increase capital gains taxes. However, the substantial nature of the latest sale suggests there may be additional factors at play.
Apple’s shares saw a significant rise in Q2, gaining 23% after the company provided more insight into its plans for artificial intelligence. This rebound followed concerns in Q1 about Apple lagging in AI innovation. Despite this positive performance, Buffett’s decision to reduce Berkshire’s Apple holdings could reflect broader strategic considerations, including market valuation, company-specific issues, or portfolio management concerns. Berkshire’s Apple stake was once so large that it represented half of its equity portfolio.
Buffett’s reduced stake in Apple comes amid a broader trend of selling by the investor. Recently, he has also downsized his second-largest stake, Bank of America, offloading $3.8 billion worth of shares over a 12-day period. The quarterly report highlights Buffett's ongoing strategy to rebalance his investment portfolio, even as the S&P 500 reached a record high in anticipation of a “soft landing” for the U.S. economy. This optimism was tempered by a weaker-than-expected July jobs report, casting uncertainty over future economic conditions.
