Artificial intelligence (AI) is one of the most transformative technologies ever seen. Unsurprisingly, the stocks of companies that are investing heavily in AI have attracted investors like bees to honey. But there's one famous investor who hasn't jumped aboard the AI bandwagon: Warren Buffett.
Buffett's Berkshire Hathaway (BRK.A 0.35%) (BRK.B 0.11%) portfolio includes only a few holdings that most would classify as AI stocks, and the billionaire investor has been selling shares of one of those ultra-popular companies. Does Buffett know something Wall Street doesn't?
Image source: The Motley Fool.
Buffett has been selling his biggest holding
You might have already figured out that the stock in question is Apple (AAPL +0.17%). The consumer technology giant has incorporated AI into its products for years. For example, Apple introduced its virtual assistant Siri as part of the iPhone 4 in 2011, and fourteen years is a long time in the fast-paced AI space.
Buffett initiated a huge position in Apple in 2016 and kept buying more shares over the next couple of years. The stock soon became the largest holding in Berkshire's portfolio. For a while, Apple made up close to 50% of the conglomerate's equity investments.
However, the legendary investor seemed to lose interest in Apple to some extent beginning in late 2023. At first, Buffett only sold a small portion of Berkshire's stake in the iPhone maker. But in the second and third quarters of 2024, he sold roughly 489 million shares. After hitting the pause button for a couple of quarters, Buffett resumed selling Apple shares in the second quarter of 2025.
Sure, Apple remains Berkshire's largest position. However, the stock now makes up 23.4% of the conglomerate's total portfolio -- less than half its peak percentage.
NASDAQ: AAPL
Key Data Points
What Wall Street thinks about Apple
Buffett has never cared about what Wall Street thinks. However, most analysts wouldn't have advised him not to sell Apple. Only 3 of the 48 analysts surveyed by S&P Global in October had a sell or underperform rating for the stock.
Wedbush's Dan Ives is especially bullish about Apple. He views the demand for the company's new iPhone 17 as strong and set a 12-month price target for Apple stock that reflects an upside potential of roughly 26%.
Morgan Stanley is another Wall Street firm that's upbeat about Apple's prospects. Its analysts, like Ives, think iPhone 17 sales will be better than expected. Morgan Stanley recently raised its price target for Apple to around 21% above the current share price.
What about the outliers on Wall Street who are negative about Apple? Jefferies is concerned about the impact of the Trump administration's tariffs on Apple's margins. Its analysts also look for minimal sales growth for Apple's products outside of its iPhones.
Does Buffett know something that analysts don't?
Buffett's decision to significantly trim Berkshire's position in Apple definitely goes against the majority opinion on Wall Street. Does the Oracle of Omaha know something that analysts don't?
Could he anticipate that Apple will continue to lose ground in generative AI? Does Buffett believe that the company won't be able to compete effectively in the smart glasses market? Maybe, but I doubt it.
In Berkshire Hathaway's 2024 annual shareholder meeting, Buffett talked about how capital gains taxes could increase in the future, with the U.S. government having to raise funds to pay its debt. He hinted that the sales of Apple stock were a tax-saving move.
It's also possible that Buffett wanted his successor, Greg Abel, to have ample cash to make one or more big acquisitions. Abel will take over as Berkshire's CEO when Buffett steps down at the beginning of 2026.
Whatever the reason for selling Apple stock, Buffett remains a fan of the company. He told shareholders at Berkshire's annual meeting earlier this year that the only quarterly investment call he listens to is Apple's. Buffett also recognized Apple CEO Tim Cook at the meeting, stating that Cook "has made Berkshire a lot more money than I've ever made Berkshire Hathaway."
