Berkshire's Q3 13F Holdings Shine: Is 'Buy Google' Now the Institutional Tech Play?

TradingKey - "Buying Google" has emerged as a distinct investment signal in previously released Q3 2025 13F filings from U.S. institutional investors. Even Berkshire Hathaway, Warren Buffett's typically cautious firm, invested over $4.3 billion to initiate a new position in Google, making it one of its top ten holdings. This significant "smart money" move into Google raises the question: Has Google won the AI race?

Ahead of the "Oracle of Omaha" Warren Buffett's planned retirement as CEO at the end of the year, Berkshire made a surprising move: spending $4.338 billion to purchase approximately 17.85 million shares of Google's parent company, Alphabet.

This marks not only Berkshire's first-ever investment in Google stock but also its sole new position and largest stock purchase by volume in the third quarter. Given Buffett's value investing philosophy and his consistently conservative stance on high-growth tech stocks, the Google purchase may not have been his personal decision.

Nevertheless, initiating a new position in Alphabet stock and immediately making it one of Berkshire's top ten holdings signifies a major bet in AI tech stocks by this large buyer, which commands over $380 billion in cash reserves.

As of the end of September, Berkshire's top ten holdings included Apple, American Express, Bank of America, Coca-Cola, Chevron, Occidental Petroleum, Moody's, Chubb, Kraft Heinz, and Google.

Notably, only two of these are technology-related stocks. Furthermore, after resuming its "trimming of Apple" in Q2, Berkshire intensified its selling in Q3, reducing its Apple holdings by nearly 15% quarter-over-quarter.

Google Gains Favor with Institutional Investors

While Berkshire's direct investment in Google stock is a first, the company had previously expressed some appreciation for it. Charlie Munger, Buffett's 60-year ally, stated in 2019 that his failure to recognize Google's value sooner made him feel "like a horse’s ass," a sentiment he believed Buffett shared.

Munger said at the time that they had witnessed the effectiveness of Google ads in their own operations but regretted not acting on it. He added that buying Apple might have been "atonement" for missing out on Google.

While the exact entry point for Berkshire's Google purchase remains unknown, the stock's performance in Q3 was indeed impressive. Google shares surged 38% last quarter, significantly outperforming Nvidia (+18.1%), Microsoft (4.3%), Amazon (+0.08%), and the S&P 500 index (+7.8%) over the same period.

Beyond maintaining its unshakeable leadership in web search, Google has become a leading AI player, leveraging AI tools such as its Gemini chatbot with 650 million monthly active users. Its cloud business is also rapidly catching up to competitor Amazon with faster growth rates.

The Q3 earnings report, released late last month, revealed that Google's revenue and earnings per share exceeded analyst expectations, with all major business segments achieving double-digit growth. This marked the first time in its history that quarterly revenue surpassed $100 billion.

In the three months ending September, institutions such as Coatue, Greenwoods Asset Management and Perseverance Asset Management also increased their exposure to Google.

Coatue's holdings of Google Class A shares surged 259.14% quarter-over-quarter; Greenwoods Asset Management's Google position soared from 1.13% to 9.64%; and Perseverance's Google holdings rose from less than 1% in Q2 to 12.55%, making it the firm's third-largest holding.

In stark contrast, large investment firms like Coatue and Tiger Global Management significantly divested from several tech peers. Tiger Global trimmed approximately 63% of its Meta stock during the quarter, while Coatue reduced its holdings by 19% in AMD, 15% in Tesla, 14% in Amazon, and 14% in Nvidia, among others.

Google's Foundation: A Full-Stack Technology Model

According to TradingKey's stock rating tool, Wall Street's average target price for Google stock is $303.084, higher than the closing price of $285.02, which rose against the backdrop of Berkshire's partial divestment. Among the 66 analysts covering Google stock, not a single one has issued a "sell" rating.

Since late October, factors such as the AI valuation bubble have caused U.S. stocks to pull back from historical highs. Google CEO Sundar Pichai recently acknowledged in a BBC interview that while the growth in AI investment represents an extraordinary moment, there is indeed some irrationality in the current AI frenzy.

Pichai stated that if the AI bubble bursts, no company would be spared. However, he emphasized that Google possesses a unique full-stack technology model—encompassing everything from chips to YouTube data, and from foundational models to cutting-edge science—a comprehensive strategy that provides greater resilience in navigating AI market fluctuations.