Warren Buffett Keeps Selling His Apple Stock: Should You?

Berkshire Hathaway has been trimming its decade-long largest holding Apple — including a sale of 42 million shares in Q3 — and at this pace American Express could soon become the conglomerate’s top position. The sell-down reflects slowing growth (Apple revenue up just under 7% y/y to $416bn; three-year cumulative revenue growth ~7.4% versus Alphabet ~37% and Microsoft ~44%), limited new hardware success (wearables ~ $37bn) and lagging cloud/AI investment that leaves the business concentrated in iPhone and services and vulnerable to disruption; reports Apple may pay roughly $1bn to have Google’s Gemini power Siri underline competitive pressures. With a P/E near 37—higher than Alphabet’s ~27 despite much slower growth—Buffett has begun reallocating into Alphabet, a move that signals valuation and innovation concerns investors should weigh when sizing Apple exposure.

Analysis

Berkshire Hathaway has materially trimmed its long-held Apple position, selling another 42 million shares in Q3, a move that—if continued—would allow American Express to supplant Apple as Berkshire's largest holding; Berkshire also added Alphabet last quarter, signaling a reallocation. The sell-down coincides with moderately negative market sentiment toward Apple and a perceived bearish reassessment by Buffett focused on valuation and growth prospects.

Apple's reported revenue rose just under 7% year‑over‑year to $416 billion, led by iPhone revenue of $210 billion (from $201 billion) and services at $109 billion (from $96 billion), yet the company's three‑year cumulative revenue growth of ~7.4% lags far behind Alphabet (~37%) and Microsoft (~44%). Wearables and other hardware contributed roughly $37 billion last year, under 10% of total sales, underscoring the business's concentration in iPhone and services.

Strategic and valuation risks are the immediate concerns: Apple has limited cloud/AI investment, a reportedly unsuccessful Vision Pro launch, and is reportedly paying about $1 billion annually to have Google’s Gemini power Siri, while trading at a P/E near 37 versus Alphabet’s ~27 despite slower earnings growth. These factors explain Buffett's trimming and argue for close monitoring of Apple’s AI strategy, product innovation cadence, and any further institutional selling as catalysts that could reprice the stock.

Key Decisions for Investors

• Reassess AAPL position sizing and consider trimming exposure if overweight given its premium P/E (~37) relative to faster‑growing peers and the company’s slower three‑year revenue growth
• Consider incremental allocation to Alphabet and Microsoft where growth and AI/cloud exposure are stronger and Alphabet currently trades at a lower P/E (~27), aligning with Berkshire’s recent purchase
• Monitor near‑term catalysts closely: quarterly iPhone and services growth, disclosures on Apple’s AI/cloud investment and the Siri/Gemini arrangement, and further Berkshire share sales as signals to adjust positions
• Avoid initiating large new AAPL positions at current valuation absent clear evidence of renewed product innovation or a credible AI/cloud strategy, and use hedges or smaller position sizes if asymmetric downside risk is a concern
• For longer‑term holders, require demonstrable changes in Apple’s innovation pipeline or margin drivers before increasing exposure; otherwise prefer reallocation to higher‑growth, AI‑exposed technology names