(Bloomberg) — Berkshire Hathaway Inc.’s continued sales of Apple Inc. shares in the third quarter left the conglomerate’s stake at a fraction of its size at the start of the year.
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Berkshire cut its holdings in the iPhone maker by roughly 25% in the period, after slashing it by almost half in the second quarter. Apple’s shares gained 10.6% in the period ended Sept. 30.
Warren Buffett hinted at Berkshire’s annual meeting in May that the sales of Apple in the first quarter were partly motivated by tax implications, and that the tech giant would remain the largest investment for the Omaha, Nebraska-based conglomerate.
That’s still true, though Berkshire’s holdings are now valued at $69.9 billion, versus $174.3 billion at the end of last year, for a decline of almost 60%. Buffett hasn’t disclosed his views on Apple since the annual meeting.
Apple is facing a raft of challenges, including a lack of meaningful growth for its signature iPhone. Last week, Apple told investors that it’s projecting low-to-middle single-digit sales growth in the December period, falling short of estimates for the crucial holiday season.
Sales in China have fallen, while domestic competitors there have gained ground. Regulators on both sides of the Atlantic are ratcheting up scrutiny over antitrust and competition concerns. And Apple has lagged behind its rivals in artificial intelligence. Last week, Apple rolled out AI upgrades for its iPhone, iPad and Mac computers but told customers the most anticipated features won’t be available until December.
“I don’t think Warren Buffett’s ever really been super comfortable with technology,” said Jim Shanahan, an analyst at Edward Jones.
“The share sales began surely after the death of Charlie Munger,” Shanahan said, referring to Buffett’s longtime business partner, who died in 2023. “It just may be the case that Munger was always a lot more comfortable with Apple than Warren Buffett.”
Another analyst suggested Buffett’s Apple sales may be down to simple portfolio rebalancing.
Cathy Seifert, a research analyst at CFRA, said Berkshire’s Apple stake was “starting to become an outsized percentage” of its overall portfolio. “I think it made sense to sort of lighten that exposure a little bit.”
Here are some other key takeaways from Berkshire’s third-quarter results: