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While Warren Buffett may no longer be the CEO of Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB), it remains a very popular company to follow because it still adheres to his principles. Furthermore, Buffett still sits on the board of directors, so if he doesn’t like what the company is doing, then he has the power to make changes. However, there were no surprises in Berkshire’s Q2 investment portfolio holdings, and Berkshire continued to do what Buffett had started in Q3 2025 before he left: buy more Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) stock.
That was the firm’s biggest move in Q2 by far, and it shows that even value investors can find great stocks in the realm of artificial intelligence (AI). I think Alphabet is a great buy for all investors, and Berkshire’s additions in Q2 prove that.
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Alphabet is dominating the AI sector
We can track Berkshire’s investment portfolio moves via a Form 13F that all funds with greater than $100 million in assets must file at the end of each quarter. This information is then released to the public 45 days after filing, so the information we have about Berkshire’s portfolio is only relevant to end-of-quarter holdings and is slightly old. However, Berkshire invests for the long term, so these quarter-end filings are more than enough information to keep investors up to date on its moves.
In Q2, Berkshire increased its stake in Alphabet by adding 48.1 million shares (almost evenly split between the two classes of stock). At today’s $340 stock price, that equates to about $16.35 billion in capital deployed in Alphabet’s stock.
That’s a huge vote of confidence and shows that Berkshire believes in Alphabet’s future as a top AI stock pick and in its continued success in the advertising space. But why is Berkshire so bullish on Alphabet?
Alphabet is firing on all cylinders
While the information Berkshire had available during its Q2 purchases was based on Q1 results, we now have access to Q2 results, which further indicate that Alphabet is becoming a dominant force in the AI realm.
First, its primary cash cow, the Google Search engine, saw its revenue rise 17% year over year — pretty good for a legacy business. Additionally, this growth shows that the theory that Google Search would be replaced with AI has proven wrong, and with Alphabet’s integration of AI search overviews, it has likely permanently defeated this thought.
The most affected portion of Alphabet’s business by AI is its cloud computing wing, Google Cloud. Most AI firms don’t have the computing power necessary to process all of their AI workloads in-house, so they rent computing capacity from a provider like Google Cloud. This is a booming business, and also why Alphabet is investing $200 billion in capital expenditures this year, mostly going toward data center construction. Google Cloud grew at an 82% pace in Q2, up from the 32% rate it provided last year during Q2. As more AI computing capacity comes online, this figure will only accelerate, leading to better results for Alphabet.
So, is Alphabet worth buying now? I’d say absolutely. A huge gain on investment currently skews Alphabet’s price-to-earnings (P/E) ratio, so I’m valuing the stock using its operating price-to-earnings ratio, which excludes that effect. From this standpoint, Alphabet is currently cheaper than at any point in Q2, outside of the dip in April.
GOOG Operating PE Ratio data by YCharts
Berkshire may have bought on the dip in April, but if it didn’t, you can buy the stock at a cheaper valuation than Berkshire did, making it a strong stock to consider adding to right now.
Should you buy stock in Alphabet right now?
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Keithen Drury has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet and Berkshire Hathaway. The Motley Fool has a disclosure policy.
