Warren Buffett has invested $159 billion in these eight artificial intelligence (AI) stocks

By | April 2, 2024

Warren Buffett said in an April 2023 interview with CNBC that artificial intelligence (AI) was “extraordinary”. However, Buffett quickly added that he didn’t “know if it’s useful.”

Whatever the multi-billionaire’s views on AI, he has already benefited financially from the technology. Buffett has invested $159 billion in these eight AI stocks – and most of them have been big winners over the past twelve months.

1. Apple

Apple (NASDAQ: AAPL) is by far the largest AI holding for Buffett. Berkshire HathawayThe company’s stake in the tech giant is worth approximately $156.9 billion. However, the stock has not performed particularly well over the past twelve months due to sluggish revenue growth.

That could change soon. Apple is widely expected to unveil its AI strategy at its developer conference and announce new AI functionality for iPhones in June.

2. Amazon

Berkshire owns $1.8 billion worth of stock Amazon (NASDAQ: AMZN) stock. Although Buffett didn’t make the original decision to buy the e-commerce and cloud services leader, he has expressed regret for not buying the stock sooner.

Amazon has long been a pioneer in AI and is reaping significant efficiency gains from the technology. The continued increase in generative AI adoption should be a big boost for the Amazon Web Services cloud platform.

3.Microsoft

Is Microsoft (NASDAQ: MSFT) a Buffett AI share? While you won’t find it in Berkshire’s regulatory filings, the answer is a resounding “yes.” Berkshire subsidiary New England Asset Management (NEAM) has a stake in Microsoft worth $11.6 million.

Microsoft has been one of the biggest winners of the AI ​​boom. The company has integrated OpenAI’s GPT-4 major language model into its product range. Microsoft’s Azure cloud platform is also seeing strong growth as customers scramble to build and deploy AI apps.

4. Broadcom

Buffett also owns shares of Broadcom (NASDAQ:AVGO) thanks to NEAM. The investment firm’s position in Broadcom was valued at more than $9.5 million at the end of 2023.

Broadcom is a leading provider of custom AI accelerators and networking software used to scale AI applications. The new XPU accelerator could claim the record as the largest chip ever built for a consumer AI company.

5. NXP semiconductors

NXP semiconductors (NASDAQ:NXPI) is another AI chipmaker in NEAM’s portfolio (making it a Buffett stock, albeit indirectly). NEAM owns an $8.9 million stake in NXP.

AI is everywhere these days – and that’s good for NXP. The company focuses on chips for the automotive, Internet of Things (IoT), mobile and communications infrastructure markets.

6.Qualcomm

Through NEAM, Buffett has a position worth $8.3 million Qualcomm (NASDAQ: QCOM). While Qualcomm hasn’t seen the blistering gains over the past 12 months that some of Buffett’s AI stocks have, its stock is still up more than 35%.

Qualcomm is best known for its technology, which is used in mobile phones. The company is also investing heavily in AI and recently collaborated with several other top tech companies to develop open-source software that allows AI apps to run on any chip.

7. IBM

Berkshire Hathaway once directly owned shares of IBM (NYSE: IBM) but doesn’t do that anymore. However, the technology pioneer remains a Buffett stock due to NEAM’s $5 million stake in IBM.

IBM may now not be seen as much of an AI leader as it once was. However, the company’s Watson platform is being used by many companies to harness the power of AI.

8. Alphabet

Buffett publicly admitted a few years ago that he had made a mistake by not investing in Google’s parent company Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) earlier. While the tech giant is still not in Berkshire’s portfolio, NEAM owns about $2.5 million worth of Alphabet stock.

Alphabet has had some PR issues with its AI efforts. But the company remains one of the leaders in AI development. There are also rumors that the company is in negotiations with Apple about integrating the Google Gemini AI models with iPhones.

Are these Buffett AI stocks a good choice to buy now?

I think all of these Buffett AI stocks can deliver solid long-term returns. What are the best choices? I like Amazon, Microsoft and Alphabet. In my opinion, AI will mainly run in the cloud. These three companies operate the largest cloud platforms and should remain big winners in the coming years.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, a director at Alphabet, is a member of The Motley Fool’s board of directors. Keith Speights holds positions at Alphabet, Amazon, Apple, Berkshire Hathaway and Microsoft. The Motley Fool holds positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Microsoft and Qualcomm. The Motley Fool recommends Broadcom, International Business Machines, and NXP Semiconductors and recommends the following options: long calls for $395 in January 2026 at Microsoft and short calls in January 2026 for $405 at Microsoft. The Motley Fool has a disclosure policy.

Warren Buffett Has Invested $159 Billion In These 8 Artificial Intelligence (AI) Stocks, originally published by The Motley Fool

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