Warren Buffett said on Monday that his company has spent US$10.7 billion to buy more than 5 percent of IBM’s stock this year, a surprising move by the billionaire investor who has long shied away from investing in high technology companies.
Berkshire Hathaway also revealed several other new investments made during the turmoil of the third quarter. Besides the new IBM investment, Berkshire added much smaller stakes in Intel Corp, DirecTV, General Dynamics Corp and CVS Caremark Corp.
Most of the details emerged from the quarterly update Berkshire filed with regulators on its US$59 billion US stock portfolio. Buffett disclosed some details in interviews earlier in the day.
Monday’s filing doesn’t offer a full picture of Berkshire’s holdings, however, because the US Securities and Exchange Commission allowed the Omaha-based company to keep some of its investments confidential.
Buffett has long refused to invest in high-tech companies because he has said it’s too difficult to predict which technology businesses will prosper in the long run.
However, he said he recently realized his view of IBM was wrong based on what he read in the company’s annual reports and what he learned by talking to IT departments at Berkshire subsidiaries. He said he should have realized years sooner that hardware is no longer the heart of IBM’s business.
“Now they’re very much a services company and they’re very intertwined with their customers,” Buffett said, adding that IBM’s customers are reluctant to change once they start working with IBM.
So Berkshire has bought about 64 million shares since March, or about 5.5 percent of IBM. Buffett says he believes IBM has a sound plan for the future.
IBM joins several other US business icons in Berkshire’s stock portfolio. Buffett’s company already holds stakes in Coca-Cola Co, American Express Co and Wells Fargo & Co, among others.
IBM officials declined to comment on Monday on Buffett’s investment. The company’s stock has more than doubled since the depth of the recession in 2008. IBM shares gained as much as US$2.46 on Monday to trade near its 52-week high of US$190.53 before slipping to close at US$187.35, down US$0.03.
Buffett said Berkshire paid an average of about US$170 per share for the IBM stock.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
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