Berkshire Piles $17 Billion More into Google: Why Is Michael Burry Worried?

Berkshire Hathaway disclosed a $17 billion jump in its Alphabet stake for the second quarter. The move makes Google’s parent Berkshire’s third largest equity holding.

The disclosure came days after investor Michael Burry criticized new CEO Greg Abel’s spending. Berkshire’s latest 13F filing also showed its first net stock buying in 14 quarters.

Alphabet Becomes a Core Holding

Berkshire now owns almost 106 million Alphabet (GOOGL) shares. The stake spans Class A and Class C stock. It is worth around $36.6 billion.

That places Alphabet just ahead of Coca-Cola’s $35.1 billion stake. It still trails Apple’s $69.7 billion position. American Express remains larger too, at $51.9 billion.

About 60% of the new shares came through a private placement. Alphabet and Berkshire announced that $10 billion deal in June. Berkshire bought the remaining $7 billion worth on the open market.

Berkshire also lifted its Delta Air Lines stake by 44%, adding about $1.6 billion. The bet reverses Warren Buffett’s long-standing skepticism toward airline stocks. Berkshire exited four carrier stocks at a loss back in 2020.

Berkshire’s Macy’s stake jumped 142%, adding about $100 million. It also added $280 million to homebuilder Lennar. The same quarter, Berkshire announced a $6.8 billion Taylor Morrison acquisition.

Burry Sounds the Alarm

Michael Burry predicted the 2008 subprime mortgage crisis. He wrote on Substack that he has soured on Berkshire.

“My biggest fear for Berkshire Hathaway was that when Warren finally stepped down, the successor would be too old and otherwise not Warren, so would not have his patience for the fat pitch. I believe this fear has come true.”

Source: Yahoo Finance

Burry acknowledged that Abel has spent only some of the cash pile. The pile hit a record $397 billion in the first quarter. It fell to roughly $360 billion in the second. Burry still called the remaining pile large.

He said Abel’s early moves look like “framing moves,” not real investments. He is not recommending anyone short the stock. Still, Burry has previously flashed red market warnings alongside Buffett.

Both share classes fell more than 3% this week. The drop came despite Berkshire’s first major buyback in two years. Alphabet shares have also recently pulled back on unrelated AI departures.

Abel’s moves could reflect a genuine strategic shift. Or they could be the cautious first steps Burry described. Berkshire’s next moves with its remaining cash may clarify which is true.