Warren Buffett, Chairman and CEO of Berkshire Hathaway.Nati Harnik/The Associated Press
For most of his career as an investor, Warren Buffett steered well clear of technology stocks. He didn’t understand what tech companies did, the Oracle of Omaha would often say, so why would he buy them as businesses? That attitude softened over time, and first with IBM shares in 2011 and then Apple shares in 2017 he plunged into the sector, later piling into Amazon shares, too. Those last two bets have paid off, helping elevate Buffett’s Berkshire Hathaway into one of the most exclusive stock groups around: the trillion-dollar club.
In late August, Berkshire’s market capitalization—the value of all its outstanding shares—crossed the 13-digit mark for the first time, a feat almost entirely limited to tech titans. The only other non-tech company to enter the field, Saudi Aramco, the massive state-owned Saudi petroleum and natural gas company, debuted there in 2019 when 1.5% of the company was spun off to public investors.
Much gets made of moments like these, partly because the sums are so mind-bendingly huge. The last similar stock-market milestone was when U.S. Steel became the world’s first US$1-billion company. That happened in 1901. Even with the effect of inflation over all this time, that US$1 billion would only be US$38 billion today, or just 3.8% of Berkshire’s current market valuation. US$1 trillion is staggering on another level, equal to roughly 60% of the Canadian economy’s entire output. To put it another way, if money were time, one billion seconds is 31.7 years; one trillion seconds is 31,700 years.
What sets Buffett’s achievement apart from other trillion-dollar-club members is how he got there: by routinely outperforming the broader stock market decade after unprecedented decade with shrewd and timely investments, including that prescient shift into tech stocks.
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