In his first three months running Berkshire Hathaway, new CEO Greg Abel boosted the conglomerate's stake in Alphabet by 224%, lifting the position to nearly 58 million shares worth about $23 billion. The move was disclosed in Berkshire's first quarterly 13-F filing under Abel, who officially became CEO on January 1, 2026, and it makes the Google parent one of Berkshire's seven largest equity holdings.
Warren Buffett initiated the Alphabet stake in the third quarter of 2025. The position was relatively modest at that point, making Abel's decision to more than triple it in his first quarter one of the most visible early signals of his investment priorities, according to Yahoo Finance.
Alphabet's financial performance in the most recent quarter gave some context for the move. First-quarter revenue rose 22% to $109.9 billion, the company's fastest growth pace in more than two years and its 11th consecutive quarter of double-digit growth. Operating income jumped 30% to $39.7 billion, and the company's operating margin expanded two percentage points to 36.1%.
Google Cloud was among the strongest contributors. That segment's revenue jumped 63% to $20 billion in the first quarter, accelerating sharply from 48% growth in the fourth quarter of 2025 and 34% growth in the third quarter of 2025. The segment's operating margin nearly doubled to 32.9% from 17.8% a year earlier, and operating income tripled to $6.6 billion. The backlog for Google Cloud, a rough proxy for revenue already under contract, almost doubled in three months to $462 billion.
"Our Enterprise AI solutions have become our primary growth driver for Cloud for the first time," Alphabet CEO Sundar Pichai said during the company's first-quarter earnings call. "In Q1, revenue from products built on our gen AI models grew nearly 800% year over year."
Alphabet's advertising business also remained strong. Search and other advertising revenue rose 19% to $60.4 billion. YouTube advertising grew 11%. Paid subscriptions across YouTube, Google One, and Gemini reached 350 million.
One area drawing scrutiny is capital spending. First-quarter capital expenditures totaled $35.7 billion, and Alphabet's management raised its full-year 2026 capital spending guidance to a range of $180 billion to $190 billion. Chief financial officer Anat Ashkenazi said that 2027 capital expenditures will significantly increase compared to 2026, a projection that creates ongoing pressure on free cash flow.