Arik Hesseldahl

Recent Posts by Arik Hesseldahl

Warren Buffett Goes Bigger on Big Blue, Bails Out of Intel

Warren Buffett has never been comfortable investing in technology. The legendary head of Berkshire Hathaway and friend of Microsoft founder Bill Gates has always maintained that he doesn’t understand tech companies and therefore doesn’t invest in them.

That changed a little bit last year when he disclosed in a television interview and in SEC filings that he had taken stakes in two technology bellwethers: IBM and Intel. Today, SEC filings show that he’s increased his already sizable stake in IBM but has sold off his Intel shares.

Explaining that Big Blue “treats its stock with reverence,” Buffett last November spent $10.7 billion to buy 64 million IBM shares — amounting to about 5.5 percent of the shares outstanding — making him the company’s biggest shareholder, slightly ahead of State Street Investments. His holdings are now north of 66.6 million shares and worth more than $13 billion.

His holdings in Intel were much more modest: The same day he announced the IBM investment, Buffett disclosed a stake in Intel amounting to 9.3 million shares, which at the time was worth about $200 million. By the end of March, that investment had declined to about 7.8 million shares. Now the latest SEC filings show Berkshire Hathaway liquidated its Intel shares as of the end of June.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik