Berkshire Hathaway (BRK.A 0.53%)(BRK.B 0.56%) published its latest 13F filing at the middle of August, giving investors some government-mandated insight into the stock buying and selling moves made by CEO Warren Buffett's company in the second quarter. Notably, the investment conglomerate once again moved to sell a substantial number of Apple (AAPL 0.51%) shares.
Apple stock stands out as a notable underperformer in the tech sector this year, with shares down roughly 10% across 2025's trading despite a gain of 8.4% for the S&P 500 and a gain of 9.4% for the Nasdaq Composite across the stretch. Berkshire moved to sell another 20 million shares of Apple in Q2, but there are likely factors driving the divestment trend that extend far beyond the stock's generally bearish movement this year.
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Berkshire dramatically reduced its Apple stock holdings
Not long ago, Apple actually accounted for over half of Berkshire's total public stock portfolio. Buffett's company once owned more than 900 million shares of the tech giant's stock. As of the investment conglomerate's last update, it had trimmed its position in Apple to 280 million shares.
Apple is still Berkshire's biggest public stock holding and accounts for roughly 21.4% of its stock portfolio as of this writing, but Buffett's company has rapidly cut its holdings since it began selling shares in the fourth quarter of 2023. While Berkshire's move to build up a cash position of approximately $344 billion suggests that the company is taking a relatively cautious approach to the stock market, there are also business-specific dynamics that could be driving its move out of Apple.
Apple's business results have been uneven recently
At the end of July, Apple published results for the third quarter of its current fiscal year -- a period that ended June 28. Sales and earnings in the period actually crushed the market's expectations, with the company's per-share profit of $1.57 on sales of $94.04 billion coming in far ahead of the average analyst estimate's call for a per-share profit of $1.43 on sales of $89.53 billion.
iPhone revenue increased 13% year over year in the period, helping to push total sales up 10% compared to the prior-year period. The performance marked Apple's strongest quarterly sales growth since the end of 2021. Notably, Berkshire made its move to sell another 20 million shares of Apple stock before the tech giant's latest quarterly report.
NASDAQ: AAPL
Key Data Points
It's possible that Buffett and the investment conglomerate's portfolio managers would have made a different decision with the benefit of knowing that the iPhone company was seeing a substantial sales growth acceleration. On the other hand, the tech leader's sales expansion has generally been pretty sluggish in recent years.
Apple's trailing-12-month (TTM) revenue is up just 4% over the last three years. Meanwhile, fellow megacap tech stalwart Microsoft has seen its TTM sales increase 39% across the stretch. While Apple's sales saw a big jump last quarter, it's possible that consumer purchasing ahead of tariffs and other one-off catalysts were big contributors to the jump.
Apple appears to be behind in AI
Compared to some other leading tech companies, Apple appears to have been caught flatfooted in the artificial intelligence (AI) race. The company's Apple Intelligence platform hasn't been a big performance driver, and reports of internal development issues were followed by news that the launch of its Siri AI technology had been pushed out to 2026 at the earliest.
The iPhone maker's massive user base and strong tech foundations give it some natural strengths in the AI space, but it's possible that Buffett and his advisors are seeing issues with the lack of results in the category so far. With Apple seemingly coming up short on AI thus far and generally weak growth in the saturated mobile market, the company is under pressure to deliver hit new products and services.
Big trouble in China?
Weak performance in China and issues related to tariffs and manufacturing have been key elements in the story behind Apple's disappointing stock performance lately. While sales in China were up 4% year over year in fiscal Q3, the performance was driven in part by government subsidies that boosted purchases for some of the company's devices. For comparison, sales in the country were down 2% year over year in fiscal Q2 and 11% year over year in fiscal Q1. In addition to issues connected to the rollout of Apple Intelligence, Chinese customers have generally been showing increasing preference for domestic brands.
New import taxes and other geopolitical and macroeconomic dynamics also present challenges for Apple. While the company has made a commitment to invest $600 billion to build out its U.S. manufacturing base, it still relies on Chinese factories for much of its production. As a result, Apple is facing some significant pressures connected to tariffs. Compared to other "Magnificent Seven" tech players, the company faces higher risks if relations between the U.S. and China continue to worsen.
While it's impossible to state exactly why Berkshire is selling out of Apple without an insider read on the situation, there are multiple dynamics that help explain why Buffett's company has been reducing its position in the stock. That doesn't mean that Apple won't be successful over the long term, but Berkshire's big divestment moves are notable in light of challenges facing the tech giant.
