Greg Abel’s Berkshire Hathaway Portfolio Allocates Over $42 Billion to Three Key Monopolies

Key Points

• Warren Buffett retired as Berkshire Hathaway’s CEO on Dec. 31, handing control of the company’s $358 billion investment portfolio to Greg Abel.
• As of late September, more than $42 billion of Berkshire’s capital was invested in three dominant companies holding virtual or legal monopolies.
• These three businesses possess strong competitive advantages that ensure predictable cash flow and robust profit margins.

It has been a year of historic transition for shareholders of Berkshire Hathaway (NYSE:BRKA, NYSE:BRKB). On Dec. 31, Warren Buffett retired as CEO after decades of steering the conglomerate to historic outperformance, handing the reins to his successor, Greg Abel. Abel now oversees the company’s massive $358 billion investment portfolio.

Despite the leadership transition, Berkshire’s core investment philosophy remains unchanged: seeking businesses with durable competitive advantages. As of Sept. 25, Abel was managing more than $42 billion invested in three companies with virtual or legal monopoly positions: Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG), Sirius XM Holdings (NASDAQ:SIRI), and VeriSign (NASDAQ:VRSN).

Virtual and legal monopolies play a big role in Berkshire’s $358 billion investment portfolio. Image source: Getty Images.

Alphabet: $36.37 Billion (both share classes, combined)

Greg Abel wasted little time leaving his mark on Berkshire Hathaway’s portfolio. In his first quarter as CEO, he jettisoned 16 holdings and reduced six others, while making one major strategic addition: Google parent Alphabet. During the first quarter, Abel more than tripled Berkshire’s stake in Alphabet, adding another $17 billion in the subsequent quarter. It now stands as Berkshire’s third-largest holding.

Google operates as a virtual monopoly, accounting for more than 91% of worldwide internet search traffic as of August. Combined with its ownership of YouTube, the second-most-visited social platform globally, Alphabet commands exceptional pricing power within the digital advertising market.

However, it is Alphabet’s artificial intelligence (AI) ambitions that truly excite investors. The integration of generative AI and large language model capabilities into Google Cloud has significantly accelerated sales in this higher-margin operating segment, positioning it for future growth.

Image source: Sirius XM.

Sirius XM Holdings: $3.23 Billion

Satellite-radio operator Sirius XM holds a legal monopoly as the only licensed satellite-radio provider in the domestic market, a position in which Berkshire Hathaway holds a 37% stake. This exclusive status grants Sirius XM substantial subscription pricing power.

The company’s most significant competitive advantage lies in its revenue mix. Unlike terrestrial and online radio providers that rely heavily on advertising, Sirius XM generates the vast majority of its sales (76.5% in the first half of the year) from subscriptions. This model yields highly predictable operating cash flow that remains resilient during economic downturns.

Furthermore, a substantial portion of Sirius XM’s costs, such as transmission fees, are fixed. Regardless of subscriber fluctuations, these core operational expenses remain relatively constant, providing investors with a high degree of financial predictability.

VeriSign: $2.58 Billion

The third monopoly in Abel’s portfolio, VeriSign, is a legacy holding from Warren Buffett’s tenure. Berkshire maintains a 10% stake in the domain-name registry service, which it has held continuously since late 2012.

VeriSign operates under a legal monopoly for the registration of leading .com and .net domain names. While domain registration volumes have slowed since the early 2000s, the business remains a highly stable, cash-generative driver with strong pricing power.

Additionally, VeriSign boasts exceptionally healthy operating margins, typically ranging in the mid-to-high 60% territory. Its infrastructure costs are minimal, and its primary expense is the fee paid to the Internet Corporation for Assigned Names and Numbers (ICANN), the entity that grants VeriSign its registration rights.

Under Greg Abel’s leadership, Berkshire Hathaway’s substantial capital allocations to these three dominant, cash-rich monopolies underscore the continued focus on durable, high-quality assets that can weather varied economic cycles.

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