{"id":113959,"date":"2026-07-21T21:37:29","date_gmt":"2026-07-21T21:37:29","guid":{"rendered":"https:\/\/www.europesays.com\/ai\/113959\/"},"modified":"2026-07-21T21:37:29","modified_gmt":"2026-07-21T21:37:29","slug":"warren-buffetts-berkshire-hathaway-owns-zero-pure-play-ai-stocks-but-this-2016-acquisition-gives-it-exposure-to-the-data-center-boom","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ai\/113959\/","title":{"rendered":"Warren Buffett’s Berkshire Hathaway Owns Zero Pure-Play AI Stocks. But This 2016 Acquisition Gives It Exposure to the Data Center Boom."},"content":{"rendered":"\n

Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB) is not as technology-shy as it once was. Over the past few decades, the holding company, led by Warren Buffett until his retirement in 2025, has increased its exposure to tech stocks<\/a>. <\/p>\n

Currently, this includes not just its large position in Apple (NASDAQ: AAPL), but also a burgeoning position in Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL), parent company of Google and YouTube. Many would also classify both of these “Magnificent Seven” stocks<\/a> as artificial intelligence plays. <\/p>\n

Missed Nvidia in 2009? This Rare Signal Is Flashing Again.\u00a0In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia.\u00a0For the first time in years, that same “Total Conviction” signal is flashing for a company 1\/100th the size of Nvidia.\u00a0Continue \u00bb<\/a> <\/p>\n

However, some will debate whether these represent “pure-play” AI stocks\u00a0in the same sense that names like Nvidia or Palantir do. But Berkshire Hathaway has AI exposure in other ways, namely, through one of its wholly owned operating subsidiaries. <\/p>\n

Berkshire bought this company many years ago and, for a while, considered it an unsuccessful acquisition. Yet thanks to the data center proliferation, Berkshire Hathaway’s 2016 purchase of Precision Castparts for $37.2 billion is starting to look like a winning move. <\/p>\n

\"Warren<\/a> Image source: The Motley Fool. From one specialty market to another <\/p>\n

Based in Portland, Oregon, Precision Castparts makes specialty metal components for the aerospace and industrial sectors. This aerospace exposure may have been why Buffett and Berkshire saw the company as a buy in 2016, but during the height of the COVID-19 pandemic in 2021, even Berkshire Hathaway admitted that it was an ill-fated deal. <\/p>\n

That year, Buffett’s holding company wrote down nearly $10 billion in goodwill related to the Precision Castparts purchase, citing the subsidiary’s diminished value due to the pandemic’s impact on air travel and, hence, demand for aerospace. <\/p>\n

Now, however, the situation has improved dramatically. Beyond a rebound in aerospace demand, chalk up Precision Castparts’ improved performance to another factor: the AI data center boom. As hyperscalers turn to gas-powered turbines to power data centers, and as these turbines use similar components to those in jet engine turbines, Precision Castparts, one of just a few companies in this niche industry, is cashing in big-time. <\/p>\n

After generating just $900 million in annual operating cash flow during the pandemic-era slowdown of 2021, last year, Precision reported $2.4 billion in operating cash flow. For reference, the company’s annual operating cash flow was around $1.7 billion just prior to its acquisition by Berkshire. <\/p>\n

The takeaway for Berkshire and its AI exposure <\/p>\n

Make no mistake: Precision’s indirect AI exposure by no means turns Berkshire Hathaway into a “pure-play” AI stock. The trillion-dollar conglomerate’s interests in sectors like insurance dwarf its exposure to the technology sector, let alone to the AI megatrend. <\/p>\n

Still, this opportunity didn’t emerge from Berkshire chasing trends. Berkshire bought Precision Castparts, sensing that the company had a deep economic moat. Recent developments validate this thesis. Precision’s edge in turbine components opened the door to the data center opportunity. <\/p>\n

This takeaway can be applied to Berkshire. By purchasing high-quality assets and investments at fair prices and holding them for the long term, Berkshire is well positioned to benefit from emerging economic trends. <\/p>\n

Only time will tell whether Greg Abel, Warren Buffett’s successor, increases Berkshire’s AI exposure. Yet if it continues to prioritize long-term quality over trends, similar situations to those at Precision Castparts could emerge. <\/p>\n

Should you buy stock in Berkshire Hathaway right now? <\/p>\n

Before you buy stock in Berkshire Hathaway, consider this: <\/p>\n

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Thomas Niel<\/a> has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Apple, Berkshire Hathaway, Nvidia, and Palantir Technologies. The Motley Fool has a disclosure policy<\/a>. <\/p>\n

Warren Buffett’s Berkshire Hathaway Owns Zero Pure-Play AI Stocks. But This 2016 Acquisition Gives It Exposure to the Data Center Boom.<\/a> was originally published by The Motley Fool <\/p>\n","protected":false},"excerpt":{"rendered":"Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB) is not as technology-shy as it once was. Over the past few…\n","protected":false},"author":2,"featured_media":113960,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[24,1147,25,3251,85,58276,3249],"class_list":["post-113959","post","type-post","status-publish","format-standard","has-post-thumbnail","category-ai","tag-ai","tag-ai-stock","tag-artificial-intelligence","tag-berkshire-hathaway","tag-data-center","tag-precision-castparts","tag-warren-buffett"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/113959","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/comments?post=113959"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/113959\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media\/113960"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media?parent=113959"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/categories?post=113959"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/tags?post=113959"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}