If you invested $1,000. Berkshire Hathaway(NYSE: BRK.A)(NYSE: BRK.B ) When Warren Buffett was CEO in 1965, you would have $42.5 million today. In the same investment S&P 500 At the same time, it grew to just $343,000, demonstrating Buffett’s amazing ability to pick stocks.
You won’t find Buffett chasing the latest stock market trends, not even as powerful as artificial intelligence (AI). However, four existing holdings in Berkshire’s $297 billion portfolio of publicly traded securities are using AI to leverage their existing trades.
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Berkshire bought shares Domino’s Pizza(NASDAQ: DPZ ) During the third quarter of 2024 (ended on September 30) it is therefore a relatively new addition to the portfolio. It is the world’s largest pizza chain, serving more than 1 million customers a day from 21,000 stores in 90 countries.
Domino’s technology is widely used to improve efficiency, which translates into lower costs and higher profits. The company one AI An algorithm to identify customer behavior, so it knows when to launch pizzas — even before an order is officially completed on the website. That means customers will receive their food faster than ever.
Eventually, Domino’s AI will want to handle everything from inventory management to employee scheduling, so this is the start of a technology revolution at the company.
Getting the approval of Buffett and his team wasn’t easy last year, as Berkshire A Net seller of stock all in all. Domino’s was one of five new additions to the conglomerate’s portfolio, which could be a very promising sign for the pizza giant.
Amazon(NASDAQ: AMZN ) It is the world’s largest e-commerce company. It also dominates the cloud computing industry, and is booming in digital advertising and streaming. AI will not just be an Amazon tool, but an integral part of the entire enterprise.
The company uses AI in its recommendation engine to show customers potential products in advance. And it has developed an AI assistant called Rufus to help customers with their purchasing decisions.
Even Amazon’s fulfillment centers are based on AI – in addition to a fleet of autonomous robots, a new technology called Project Personal Inspector uses AI and computer vision to identify defective products before they are shipped to customers.
Then there’s the Amazon Web Services (AWS) cloud platform, which is becoming the preferred destination for developers looking to build AI software. AWS is working to manage the three main AI cloud services: infrastructure (data centers and chips), large-scale language models (LLM), and software.
During the third quarter of 2024, management said AI revenue at AWS grew by triple-digit percentages year-over-year, and is currently growing three times faster than the cloud business did at the same point in its lifecycle.
Berkshire bought Amazon stock in 2019, but Buffett has often expressed regret for not realizing the company’s potential sooner. Still, the company’s position is worth more than $2.3 billion, so Berkshire stands to make a lot of money if Amazon continues to lead the AI race.
coca cola(NYSE: KO ) It is the world’s largest beverage company, with people in 200 countries consuming 1.9 billion drinks every day. Achieving that level of scale wouldn’t be possible without technology, and Coca-Cola is maintaining its history as an innovator by investing heavily in AI.
In April 2024, the company pledged to spend $1.1 billion over five years. MicrosoftAzure cloud platform to access a portfolio of AI services to improve supply chain, productivity and marketing.
If you talk about marketing, Coca Cola has already used AI in many campaigns. Just in time for the holiday season, it launched Create Real Magic, which allowed users to generate holiday-themed digital snow globes on the company’s website.
Before that, it used AI to create a promotional version of its flagship soda, Coca-Cola Y3000, which showed what the drink might look like in 3000 AD, based on data from customers.
Berkshire He acquired 400 million Coke shares between 1988 and 1994, at a total cost of $1.3 billion. He never sold a single share, and today, that share is worth more than $25 billion. Buffett probably doesn’t think AI will be a big part of Coca-Cola’s future, but Berkshire will benefit from the value it creates.
Apple(NASDAQ: AAPL ) In the year By early 2024, it would account for 50 percent of the total value of Berkshire’s portfolio, but Buffett and his team decided to sell more than half of the position to take some of the conglomerate’s profits. Apple remains Berkshire’s largest holding, though, with a 22.7% weighting in the portfolio.
Management has been preparing for the AI revolution for some time. The strategy started with hardware, as the company had to design new chips and components for new iPhones, iPads and Mac computers capable of supporting the technology. Along with those currently in the works, the company also launched Apple Intelligence software last year, which introduced new AI features.
These include new writing tools that allow users to quickly compose email and text messages and then generate outgoing responses. Apple Intelligence can prioritize notifications to users based on their preferences, saving time. Even Siri’s voice assistant has received a makeover, as it now taps into OpenAI’s ChatGPT expertise and capabilities.
There are more than 2.2 billion active Apple devices worldwide, so the company could eventually become the largest distributor of AI to consumers. So, despite last year’s sales expansion, Berkshire could still do extremely well in the long run with its remaining shares.
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John McKee, former CEO of Whole Foods Market, a subsidiary of Amazon, is a member of the Motley Fool’s board of directors. Anthony DiPizzio It has no place in the said shares. He has a spot in the Motley Fool and recommends Amazon, Apple, Berkshire Hathaway, Domino’s Pizza and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 calls on Microsoft for $405. The Motley Fool has Disclosure Policy.
