Even at 91 years old, Warren Buffett is widely regarded as one of the greatest investors in the world. During his ongoing 55-year tenure at his Berkshire Hathaway (BRK.A 0.63%) (BRK.B 0.52%) investment company, he has delivered an average annual return of 20%, double the return of the benchmark S&P 500 stock market index. 

Buffett's investment philosophy is surprisingly simple: focus on companies that make consistent profits, return money to their shareholders, and have diverse revenue streams. Most importantly, however, he buys these companies with the intention of holding for the extreme long term. 

Here are two of Berkshire's best picks that have consistently fit the bill over their respective multidecade histories and are likely to continue doing so.

The case for Amazon

Amazon (AMZN 0.90%) went public in 1997, just as the internet technology boom was really heating up. Warren Buffett tends to shy away from businesses he doesn't quite understand, so he avoided Amazon stock, despite recognizing the company for its innovation. It's returned over 122,000% since its IPO. Although Berkshire made a $1 billion purchase in 2019, Warren Buffett has repeatedly expressed regret for not buying in sooner.

Amazon is now the global leader in e-commerce but also has evolved into an incredibly diverse company. Its Amazon Web Services (AWS) business is widely regarded as the No. 1 cloud services provider, and its advertising segment has generated $32.6 billion in sales over the last four quarters -- even more than Alphabet's YouTube video platform.

Advertising could be a strong source of revenue for Amazon going forward as the company leverages its growing portfolio of digital assets. These include its music platform and the rights to the NFL's Thursday Night Football on its Prime streaming service. But for now, AWS is the star of the show, serving as the profitability engine behind the entire company. Despite accounting for just 14% of Amazon's $477.7 billion in total revenue, AWS is responsible for all of its operating income over the last four quarters. 

Earlier this year, Amazon announced a new $10 billion share-buyback program, which was the last piece in the Buffett puzzle. Now Amazon is profitable, diverse, and returns money to shareholders. It also has a 25-year track record of performance. With Amazon stock currently down 41% from its all-time high amid the broader tech sell-off, investors might want to buy the dip.

The case for Apple

Not only is Apple (AAPL 0.42%) the largest company in the world, with a $2.3 trillion market valuation, but it's also the largest position in Buffett's portfolio. It makes up 41.1% of Berkshire's $322.7 billion in total stock holdings, and like Amazon, it checks all the boxes.

While Apple is best known for its hardware products like the iPhone, iPad, AirPods, and Mac line of computers, it has rapidly expanded its portfolio of services, which are growing more quickly and are more profitable at the margin. These include Apple Pay, Apple Music, iCloud, and the Apple TV+ streaming platform, to name a few. 

Where a consumer might purchase a new iPhone once every year or two, most of Apple's services brands are subscription-based, so they generate recurring revenue every month, in many cases. Over the last four quarters, the services segment has made up 19.4% of Apple's total $386 billion in revenue, so it's still a relatively small part of the overall business. But it grew by 24.4%, compared to the prior-12-month period, which is much faster than the products segment's 17.3% growth.

Based on Apple's most recent second quarter of fiscal 2022 (ended March 26), the services segment had a gross profit margin of 72%, compared to just 36% for products. That's because Apple's services are digital and can be delivered instantly with low costs, whereas hardware is expensive to make. In any case, the two business units complement each other nicely and have combined for $101 billion in net income (profit) in the last four quarters.

What does Apple do with all that money? Besides investing in new innovations, it's returning a significant amount to shareholders in two ways. First, it pays a modest quarterly dividend of $0.23 per share, which equates to a dividend yield of 0.68%. Second, it has a very large share-buyback program, totaling $90 billion at the moment, but it follows $43 billion in the last two quarters and another $85 billion in the fiscal 2021 full year.

It's little wonder Buffett is hot on Apple stock. Since the stock trades at a 20% discount from its all-time high, maybe you should be, too.