Greg Abel Bets on AI: Berkshire Triples Alphabet Stake

For over half a century, Warren Buffett ran Berkshire Hathaway with a famously conservative approach, and the results were extraordinary — the Class A shares outpaced the S&P 500 by more than 6,000,000% since the mid-1960s. When he retired on Dec. 31, the question was whether that style would leave with him. Greg Abel's early moves suggest part of it has.

Buffett himself initiated the first Alphabet purchase last year, but it was Abel who more than tripled the stake in the first quarter and added another $17 billion in the second. The reasoning he gave CNBC's Becky Quick was grounded less in markets than in operations: Berkshire's own companies showed him how AI was being used and what benefits it delivered, which he said brought "incremental interest" and led Berkshire to see Google as a significant player. Notably, that growth is tied more to Google Cloud than to search — revenue there skyrocketed 82% in the June-ended quarter, with over $99 billion in annual run rate sales.

On energy, Abel still sounds like Buffett. He spent considerable time acknowledging the backlash against data centers and said supplying the needed infrastructure only made sense if it didn't raise costs for customers. That caution is the crux: the data center buildout looks like steady demand growth for Berkshire Hathaway Energy, and Goldman Sachs expects electricity prices to rise through the rest of the decade with data centers driving an estimated 40% of demand growth. Whether Abel captures that upside without passing costs to ratepayers is likely to define how far the wager goes.