The New No. 1: Tracking Berkshire Hathaway's Shift Away from Apple to American Express

For decades, Warren Buffett steered Berkshire Hathaway’s $319 billion investment portfolio with a philosophy centered on quality, durability, and exceptional returns. The year 2025 marked a historic turning point—not just because Buffett retired as CEO on December 31, but because his departure is bringing structural changes to one of the world’s most scrutinized investment portfolios. At the center of this shift is a dramatic reordering of holdings, with tech giant Apple making way for a financial powerhouse that offers something Buffett always prized: reliable income generation and business resilience.

Tracking the Apple Exit: How Buffett’s 75% Stake Reduction Reshapes the Portfolio

Apple held court as Berkshire Hathaway’s No. 1 investment for nearly a decade, a position that seemed unshakeable. The stock checked every box in Buffett’s playbook: a loyal customer base willing to pay premium prices for the iPhone, a commanding position in U.S. smartphone market share, and an aggressive share buyback program that had retired over 44% of outstanding shares since 2013. By retiring $841 billion in stock through buybacks, Apple had powered impressive earnings-per-share growth—exactly the kind of financial engineering that appeals to value-focused investors.

Yet something shifted dramatically in Buffett’s final years. From the fourth quarter of 2023 through his retirement at year-end 2025, Berkshire tracked a massive reduction in Apple holdings—687.6 million shares sold across nine quarters, representing a 75% stake reduction. This wasn’t passive portfolio drift; it was systematic selling that caught many investors off guard. While Buffett initially framed some of this selling as tax-advantaged profit-taking during his May 2024 shareholder meeting, the scale and persistence suggest deeper concerns about valuation and opportunity cost.

The numbers tell the story clearly. When Buffett began accumulating Apple shares in early 2016, the stock traded at 10-15 times trailing twelve-month earnings. By late February 2026, Apple commanded a trailing price-to-earnings multiple of approximately 33 times. For a company that had struggled with physical device sales weakness from fiscal 2022 through fiscal 2024, this premium valuation looked increasingly unjustifiable by Buffett’s standards. Even with Apple Intelligence generating buzz about potential AI-driven growth acceleration, the company no longer qualifies as a bargain—and new CEO Greg Abel has shown himself equally committed to disciplined capital deployment at reasonable prices.

As Berkshire’s Apple position contracted, so did its market weight. By mid-February 2026, Apple accounted for just $59.39 billion of Berkshire’s invested assets, down from $151.3 billion just three years earlier. This wasn’t merely a rebalancing; it was a repositioning that left room—and capital—for something else.

American Express on Track to Claim the Top Spot

The beneficiary of Apple’s exit appears predetermined: American Express. As of late February 2026, Amex held $51.95 billion in market value within Berkshire’s portfolio, a gap of just $7.44 billion from Apple. Track the trajectory of this competition, and the math becomes compelling. While Berkshire has been aggressively trimming Apple, the company hasn’t sold a single share of American Express—a deliberate choice that speaks volumes about management confidence.

In one of his final shareholder letters, Buffett identified eight stocks he considered “indefinite” holdings worthy of permanent residence in Berkshire’s portfolio. The list included iconic names like Coca-Cola and Occidental Petroleum, but also American Express. The distinction matters: Buffett doesn’t casually declare holdings as permanent. This designation signals that Amex is expected to remain a cornerstone position, regardless of market conditions or valuation cycles.

Berkshire’s American Express stake comprises 151.6 million shares, a position accumulated over 35 years. The company’s cost basis sits at a remarkable $8.49 per share—a number that demonstrates both the value Buffett extracted from this investment and the historical advantage of long-term holding. More important, this static position size means that Amex’s market value is entirely dependent on stock price appreciation, not on ongoing share purchases. At current prices with the stock performing well, this dormant position could naturally eclipse Apple’s declining stake during 2026.

Why American Express Is Generating Superior Returns for Berkshire

American Express represents precisely the kind of business Buffett loves: profitable, resilient, and capable of extracting value from both sides of a transaction. This dual income stream is central to Amex’s appeal. The company operates as both a payment processor and a lender, creating multiple paths to profitability.

On the merchant side, American Express earns transaction fees from the vendors who accept its card network—making it the third-largest credit card payment processor by volume in the U.S. On the cardholder side, Amex functions as a financial institution, generating interest income from cardholders’ carried balances and collecting annual membership fees from premium card tiers. This two-pronged model insulates Amex from many of the competitive pressures facing single-revenue-stream processors.

There’s another competitive edge: American Express has cultivated a reputation as the card for affluent consumers. This customer base composition matters enormously during economic cycles. Wealthy cardholders are statistically less likely to reduce spending or default on payments during recessions compared to average-income populations. When economic turbulence strikes, Amex should bounce back faster than peers, making it a natural recession hedge within a portfolio.

The dividend story sealed Buffett’s commitment to holding indefinitely. American Express pays $3.28 per share annually in dividends. For a company with a cost basis of $8.49 per share, this yields an extraordinary 38.6% annual return on cost—a metric that grows more impressive each year. In concrete terms, Berkshire has essentially recovered its entire initial $1.3 billion Amex investment through dividend payments alone in less than three years. This is passive income generation at its finest.

The Macro Backdrop Supporting Amex’s Rise

Beyond the mechanics of Berkshire’s portfolio, American Express benefits from broader economic tailwinds. The U.S. economy continues demonstrating resilience, with expansion periods substantially outpacing recession cycles. This means Amex—as a company whose growth is tethered to consumer spending and business activity—should continue expanding in lockstep with national economic growth.

Consumer confidence remains elevated enough to support premium card spending, which feeds Amex’s network volumes and interchange economics. Even as policymakers navigate inflation and interest rate questions, the baseline assumption of continued American economic growth plays directly into Amex’s strategic position.

What This Portfolio Shift Means for Investors

The reordering of Berkshire Hathaway’s top holdings represents more than a technical portfolio adjustment—it’s a referendum on what constitutes value in 2026. Apple, once the exemplary Buffett investment, has become too expensive for its growth profile. American Express, by contrast, checks multiple boxes: reasonable valuation, fortress-like competitive advantages, predictable cash generation, and management explicitly committed to holding for the long term.

For investors tracking Berkshire’s moves as a proxy for investment philosophy, the message is clear: quality endures, but price still matters. The shift from Apple to American Express isn’t a rejection of technology or an embrace of stagnation. Rather, it reflects a disciplined reallocation toward assets that generate sustainable value per dollar invested—a principle that has defined Buffett’s career and that his successor shows every sign of maintaining.