Warren Buffett's Secret Portfolio Is Dumping Shares of 3 Supercharged Artificial Intelligence (AI) Stocks (No, Not Nvidia!)

Core Viewpoint - Berkshire Hathaway's New England Asset Management (NEAM) has a secret portfolio valued at $602 million, which has recently sold off significant stakes in three prominent AI-related companies, indicating a cautious stance on the AI sector [1][2][3]. Group 1: Portfolio Overview - NEAM's portfolio has decreased from $6.3 billion in March 2022 to $602 million as of June 30, 2024, reflecting a trend of net selling in equities [3]. - The portfolio is effectively under Warren Buffett's umbrella, although he does not manage it directly like the main Berkshire Hathaway portfolio [3]. Group 2: Company-Specific Actions - Broadcom: NEAM reduced its stake in Broadcom by 19% in the latest quarter. Broadcom benefits from AI growth through its networking solutions but is also diversified in wireless chips and cybersecurity [5][6]. - Microsoft: NEAM sold over 20% of its Microsoft stake, despite the company's strong AI integration and growth in its Azure cloud services. The decision may be influenced by Microsoft's high valuation, trading at nearly 32 times consensus earnings for fiscal 2026, which is about 7% above its five-year average [8][10]. - Alphabet: NEAM sold nearly 28% of its stake in Alphabet's Class A shares. Alphabet's growth is tied to its Google Cloud services and strong cash position, yet concerns about the AI bubble and overall market valuations may have prompted the sell-off [11][12].