Although Warren Buffett hasn't been a huge fan of tech stocks in the past, he has bought several for Berkshire Hathaway (BRK.A -0.76%) (BRK.B -0.69%) through the years. Apple is by far his biggest holding.

It wasn't all that surprising, therefore, when Buffett first initiated a position in HP (HPQ -0.46%) in 2022. The company had a business model that the Oracle of Omaha could readily understand. Its stock appeared to be attractively valued. HP even offered a juicy dividend. But whatever appeal this high-yield dividend stock once had for Buffett appears to have faded dramatically.

Further slashing a once-massive position in HP

Back in the first quarter of 2022, Buffett bought 104 million shares of HP for Berkshire's portfolio. In the early part of Q2, he added more than 16 million shares to the conglomerate's stake in HP.

As recently as 2023's Q1, Buffett was still buying HP stock. Berkshire purchased nearly 16.5 million shares earlier this year. It was HP's largest shareholder, owning more than 12% of the company.

That was then. In this year's Q3, Berkshire began steadily reducing its position in HP. On Dec. 11, 2023, the company revealed in a regulatory filing that it had slashed its stake in HP to 5.2%.

Sure, Berkshire remains one of HP's largest shareholders. The conglomerate still owns roughly 51.5 million shares of HP, representing 5.2% of its outstanding shares. However, HP isn't in Buffett's favor as it once was.

Why is Buffett selling HP stock?

HP has lagged well behind the S&P 500 since Berkshire first initiated a position in the stock. Even with dividends included, its total return is also far below what the S&P 500 has delivered during the period.

But that probably isn't why Buffett is selling the stock. He focuses on companies' underlying business. And HP's business hasn't been as strong as the Oracle of Omaha would have liked.

As a case in point, HP's revenue in fiscal 2023 sank by 14.6% year over year. The company's profits plunged 22% for the full year. Free cash flow was 20% lower.

The story for HP improved somewhat in its latest quarter but not enough to get excited about. HP's fiscal Q4 revenue tumbled 6.5% year over year. However, the company's adjusted earnings per share rose 10%, while its free cash flow increased by 3%.

HP's biggest problem spot is its personal-systems segment, which sells computers, displays, point-of-sale systems, headsets, and more. Sales continue to decline in this lower-margin business.

The company makes higher profits from its printing segment. Unfortunately, net revenue for this segment also slipped a little in the latest quarter with an especially big hit for its consumer printing business.

Should you sell HP stock, too?

Just because Buffett is reducing Berkshire's stake in HP doesn't necessarily mean that you should sell the stock, too. Your investing goals could be different from those of a giant conglomerate that must answer to shareholders.

Income investors might want to hold onto their HP stock. The company's dividend yield of over 3.6% looks great. HP is generating sufficient free cash flow to continue funding its dividend program. CEO Enrique Lores also said in the latest quarterly update that the company expects to resume stock buybacks in the first quarter.

That said, HP isn't going to appeal to growth-oriented investors. Even if the environment for the company's products improves, HP isn't likely to deliver compelling growth.