Warren Buffett and Berkshire Hathaway are known for investing in established companies with strong cash flows. However, their latest investment in Alphabet (GOOG) has raised eyebrows due to its involvement in cutting-edge quantum computing.
Berkshire took a position in Alphabet during Q3, but it’s unclear if CEO Warren Buffett was directly involved in the purchase. Nevertheless, this investment aligns with Berkshire’s value investing philosophy and Buffett’s long-standing admiration for Alphabet.
Alphabet’s quantum computing efforts are impressive, having recently achieved significant breakthroughs with its Willow quantum computing chip. However, Buffett is unlikely to have invested solely due to these advancements. Instead, he probably recognized the company’s strong base business, including its advertising revenue growth and massive cash flows.
A solid stock like Alphabet has several potential winners growing under its umbrella, including artificial intelligence (AI) and cloud computing. The investment may be a surprise, but it fits Berkshire’s criteria for valuing businesses with proven operations.
Investors shouldn’t be surprised that Berkshire eventually came around to owning Alphabet, given Buffett’s previous praise of the company. However, the quantum computing aspect remains a departure from Berkshire’s typical investment focus on simple and easily understandable businesses.
Despite this, Alphabet checks many boxes for Berkshire, including its strong base business and massive cash flows. With long-shot investments also being made, it has several potential winners growing under its umbrella. The stock may be primed for even more upside in 2026 and beyond.
Source: https://www.fool.com/investing/2025/11/22/meet-the-genius-quantum-computing-stock-warren