Berkshire Hathaway has significantly reduced its investment in Apple, as revealed in its second-quarter earnings report released over the weekend. The company, led by Warren Buffett, now holds $84.2 billion in Apple shares, down from $174.3 billion at the beginning of the year.
In addition, Berkshire Hathaway holds $234.6 billion in U.S. Treasury bills, surpassing the Federal Reserve’s holdings.
This announcement resulted in a sharp decline in Apple shares on Monday. The stock dropped over 9% in pre-market trading but made a slight recovery once the market opened, ultimately being down about 5% shortly after trading commenced.
Berkshire Hathaway has decreased its investment in Apple for three consecutive quarters, yet it remains the company’s largest stock position, followed by Bank of America at $41.1 billion and American Express at $35.1 billion, as of June 30.
Warren Buffett, during a Q&A session in May, expressed confidence in maintaining ownership of Apple, American Express, and Coca-Cola when his successor, Greg Abel, takes over.
Despite the recent drop, Apple’s stock had previously risen significantly, climbing more than 35% during a three-month period, peaking at $237 in mid-July. This surge followed Apple’s announcement of its AI initiatives at the Worldwide Developers Conference earlier in June. Analysts predict that Apple shares will continue to rise in the long term, particularly with its AI-enhanced iPhones expected to transform the smartphone industry. Apple’s latest earnings surpassed Wall Street expectations by nearly $2 billion, although sales in China were weaker.
On Monday, while experiencing a decline, Apple’s stock remains nearly 30% higher compared to three months ago. The company is among several large technology firms facing challenges, contributing to the Nasdaq index’s potential for its largest drop since March 2020.