Berkshire Hathaway shares outperform amid AI-driven market selloff

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Berkshire Hathaway outperforms AI selloff

Highlights

Berkshire Hathaway shares gained over 5% this week as investors rotated out of falling tech stocks, with the S&P 500 down almost 2.7% and Nasdaq down 3.4%.
Berkshire's Class B shares, once underperforming the S&P 500 by 13.6 percentage points this year, now lead the benchmark by 5.8 percentage points after three record-high closes.
Berkshire's Alphabet stake, valued at $37.8 billion on June 30, has declined by around 20% to $30.2 billion, dropping it to the fourth-largest equity holding.

Shift toward Berkshire during tech retreat

As reported by CNBC, Berkshire Hathaway shares are rising this week as investors move money out of declining technology names and into companies seen as offering relative safety, with less direct exposure to the risks tied to heavy AI infrastructure spending.

Berkshire is up more than 5% for the week, while the S&P 500 is down almost 2.7% and the Nasdaq Composite has fallen 3.4%. Heavy selling in technology stocks on Thursday pushes the Nasdaq more than 10% below its most recent high, a level commonly described as a correction, before the index recovers part of those losses on Friday.

One month ago, Berkshire's widely held Class B shares were underperforming the S&P 500 by 13.6 percentage points for the year. After three more record-high closes this week, the stock is now 5.8 percentage points ahead of the benchmark.

Two weeks ago, Berkshire's share price fully erased the roughly 15% decline recorded in the three months after Warren Buffett's surprise announcement at the 2025 shareholders meeting that he would step down as chief executive at the end of that year. The shares are now 6% above the record closing level reached on the Friday before Buffett's May 3, 2025 announcement.

Alphabet stake and portfolio implications

Berkshire's recent strength is coming even as its investment in Google parent Alphabet faces fresh pressure. Greg Abel, Berkshire's incoming chief executive, said in early September that Berkshire Hathaway Energy sees a significant opportunity to supply electricity to data centers, and he also said Berkshire expected to benefit from its large Alphabet holding because AI was set to have a significant effect on U.S. businesses.

That position is now under scrutiny as Alphabet shares fall with other AI-linked companies. As of the end of June, Berkshire reported ownership of nearly 106 million Alphabet shares, including 28.6 million shares bought directly from the company in June through $5 billion of Class A stock at $351.81 per share and another $5 billion of Class C stock at $348.20 per share. Those shares are now trading around $284.

Bloomberg says Berkshire's push into AI may now look poorly timed as cracks emerge in the trade. On June 30, the Alphabet stake was valued at $37.8 billion and ranked as Berkshire's third-largest equity holding, but after declines of around 20% in both share classes, the stake is now worth about $30.2 billion, behind Coca-Cola's $38.3 billion and down to fourth place in the portfolio.

Investors are due to get another update in just over a week, when Berkshire's third-quarter holdings through September 30 are expected to show whether the company changed its Alphabet position.

Our earlier coverage of the Nasdaq-100 (NDX) highlighted a sharp intraday selloff that left the index under short- and medium-term moving averages, keeping near-term downside risks in focus. That article also noted the launch of JQQQ, a blockchain-native fund designed to provide digital access to Nasdaq-100 exposure, even as momentum signals remained mixed and traders watched key resistance and support levels for a breakout.

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