Berkshire CEO has sobering message for tech stock investors

In his archetypal yearly gathering arsenic Berkshire’s apical honcho and Warren Buffett’s successor, helium said that the institution isn’t treating tech spending oregon tech stocks arsenic a momentum game.

That’s the other of what we’ve seen transpire implicit the past mates of years, wherever the “Magnificent Seven” stocks person attracted billions successful capital.

Investors person been incessant successful pouring wealth into tech giants pursuing their respective AI-first visions.

AI leaders, including Alphabet, Amazon, Meta, and Microsoft, are connected way to walk a staggering $700 cardinal successful combined capex this year, up substantially from $410 cardinal successful 2025.

In opposition to what the marketplace has been astir lately, Abel’s connection is astir restraint.

Berkshire is synonymous with discipline, and clearly, Abel isn’t looking to wantonness that mantra anytime soon.

That stance besides carries a ton of value due to the fact that Berkshire is present sitting connected a grounds $397.4 cardinal currency pile.

It has the firepower to marque monolithic tech banal bets and thin aggressively into AI.

Instead, Abel drew a antithetic enactment astatine Berkshire’s 2026 yearly gathering connected May 2.

“We're going to beryllium a builder of technology, alternatively than conscionable a purchaser of technology,” helium told shareholders.

He past added,

“It has to beryllium additive to our businesses. We're not going to person AI conscionable to person AI.”

Takeaways from CEO Greg Abel’s exertion message

• Technology should complement, not beryllium a fix-on: Abel noted that tech needs to genuinely adhd worth to a business, alternatively than simply service arsenic a sticker signaling AI use.

• Buyer mindset versus builder mindset: Berkshire is looking to spell in-house with AI solutions, specified arsenic the predictive attraction effort astatine BNSF Railway, alternatively than leaving innovation to others.

• The regularisation of superior subject is unbreakable: "Capital subject is the rule," said Abel, who has northbound of $350 cardinal successful currency and short-term securities astatine his disposal, "which we volition beryllium acting decisively upon erstwhile determination is simply a dislocation, and the terms is right.

• Conglomerate operation is simply a feature, not a bug: Berkshire is structured arsenic a decentralized enactment to deploy exertion without the "bloated costs" seen successful accepted conglomerates.

Berkshire’s net past shows dependable EPS strength

Berkshire’s net show lately points to a beardown way grounds of accordant EPS beats, though gross maturation has been uneven crossed quarters.

• FQ1 2026: EPS of $5.26, beating estimates by $0.21; gross of $92.07 billion, year-over-year maturation of 2.6%.

• FQ4 2025: EPS of $4.73, missing estimates by $0.44.

• FQ3 2025: EPS of $6.25, beating estimates by $0.52; gross of $94.97 billion, missing estimates by $2 billion, with year-over-year maturation of 2.13%.

• FQ2 2025: EPS of $5.17, beating estimates by $0.14; gross of $92.50 billion, beating estimates by $10.29 billion, contempt a year-over-year diminution of 1.22%.
  Source: Seeking Alpha.