Berkshire Hathaway boosts Alphabet, exits Amazon: Greg Abel's first quarter as CEO signals portfolio shift

Berkshire Hathaway's quarterly portfolio disclosures reveal significant shifts in investment strategy under newly appointed CEO Greg Abel, who took over from Warren Buffett in his first months at the helm. The most striking move: a dramatic increase in Alphabet holdings while completely exiting the Amazon position that Buffett had accumulated over years. The Alphabet boost suggests Abel views the search giant as better positioned for AI monetization than the e-commerce and cloud juggernaut, while the Amazon exit signals skepticism about near-term margins and valuation in an environment where tech growth is facing headwinds from rising rates.

Additionally, Berkshire sold approximately $8 billion of Chevron shares as crude prices reached record highs in the first quarter. On the surface, this seems counterintuitive: oil prices are soaring, energy stocks are benefiting, and Berkshire had been a long-term energy bull. But the sale suggests that Abel and the investment committee believed valuations had become stretched, or that near-term energy demand could be pressured by economic slowdown. This disposition also signals caution about the inflationThe rate at which prices rise across an economy. and geopolitical risks that are now front-and-center on May 15, as the bond market is repricing inflation expectations sharply higher.

The moves are being interpreted by market strategists as a signal that Berkshire, despite its massive cash position near $200 billion, is rotating defensively. Abel has historically favored industrials, railways, and energy infrastructure, but the Q1 portfolio actions suggest a more cautious tone. Some analysts have noted that the shift toward Alphabet (a mega-cap tech name with strong free cash flowCash generated after maintenance capex; the actual money the business throws off. and shareholder returns) while exiting Amazon (higher growth but lower margins) implies a preference for cash-generative, mature businesses over high-growth bets. This aligns with broader market rotation dynamics in May, where value and dividend-paying names have outperformed mega-cap growth.

Wall Street observers are now watching for signals on Berkshire's next moves. With $200 billion+ in dry powder, the question is whether Abel will deploy this capital on an acquisition, a large equity stake in another mature company, or continue trimming positions as valuations compress under rising rate pressure. The fact that Berkshire sold so much Chevron while energy is rallying suggests Abel is not confident in a sustained cycle. Similarly, the Amazon exit at near all-time valuations suggests wariness about the durability of cloud spending growth in a higher-rate environment.