The multi-billionaire’s conglomerate announced on Monday that it had bought 9.8m shares in Apple, a surprise move as Buffett has mostly avoided investments in the tech industry.
Buffett’s investment in Apple comes as Carl Icahn, another famous investor with a long history of taking activist stakes in tech firms, sold more than 45m Apple shares and said the company was no longer a “no-brainer” investment.
Berkshire Hathaway, which manages assets and investments of more than $500bn, disclosed in a regulatory filing on Monday that it held 9.8m Apple shares as of 31 March.
Apple’s shares, which have lost almost a third of their value since mid-April when the firm announced its first quarterly drop in sales in 13 years, rose 3.4% to $93.50 dollars by 11am on Monday following the news.
Buffett, who is the world’s third richest person with a $66.5bn fortune according to Forbes magazine, has previously only invested in one tech company: IBM. Berkshire Hathaway first bought into IBM in 2011 and now holds a stake worth $12.3bn.
Asked why he had bought IBM shares rather than Apple or Google at Berkshire Hathaway’s 2012 shareholder meeting, Buffett said: “The chances of being way wrong in IBM are probably less, at least for us, than the chances of being way wrong in Google or Apple ... I just don’t know how to value them.
“I would not be at all surprised to see them be worth a lot more money 10 years from now but I would not buy either one of them. I sure as hell wouldn’t short them either.”
Buffett, who is known as the “sage of Omaha”, may be changing his stance on tech stocks. He also on Monday told CNBC that he has offered to help Dan Gilbert, the chairman of Quicken Loans and owner of the Cleveland Cavaliers basketball team, finance a bid for Yahoo.
Apple’s second quarter sales fell from $58bn to $50.6bn, and CEO Tim Cook warned investors of further falls to come, with its next quarterly sales projected to come in at $41-43bn, considerably lower than expectations of $47.3bn.
The iPhone, which has transformed not just telecommunication but music, banking and boring train journeys with its games, suffered its first ever quarterly drop in sales in the first three months of the year.
Apple sold 51.2m iPhones, 10m less than it shifted in the first three months of 2015 but more than the just 50m analysts feared. The company also charged less for the phones it did manage to sell with it achieving an average price of $642 for each iPhone sold compared to $691 in the previous quarter.
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