Warren Buffett told CNBC on Wednesday that he personally initiated Berkshire Hathaway's roughly $31 billion stake in Alphabet, a candid admission that the 95-year-old chairman missed the chance to buy the Google parent when it was, in his words, "asset-light and a markets darling."
The position now sits as Berkshire's fifth-largest holding, behind Apple, American Express, Coca-Cola and Bank of America. It comprises about $21 billion in public shares plus a $10 billion private placement that was part of Alphabet's $80 billion equity raise in June, a structure that matters because it makes Buffett an equity owner in the AI build-out rather than a creditor.
That distinction is the whole story. Hyperscalers spent roughly $1 trillion on data centers last year and have $4 trillion in construction plans through 2030, according to Motley Fool research. Yet bond appetite has cooled fast: Apollo Global Management says coverage ratios for hyperscaler bonds dropped from nearly 5 times in February to under 2 times in July. Investors are asking who holds the risk if AI returns are delayed.
Alphabet's answer is equity, not debt. Buffett framed it as a vote of confidence in a company "more likely to be a winner based on their record than probably 90% or 95% of what gets merchandised through Wall Street." The fundamentals back him: first-quarter 2026 revenue rose 22% year over year to $110 billion, Google Cloud grew 63%, and the backlog nearly doubled to more than $460 billion.
Even so, Buffett tempered the enthusiasm. "I would say that I don't like it as well as at least four or five other businesses that we own," he said. The bet implies Alphabet can spend more than $180 billion on data centers this year and still come out ahead. Whether the equity-funded model survives the hot-potato phase of AI financing is the question worth watching.