Warren Buffett’s Most Profitable Investment — And the Lessons That Could Make You Rich

In late 2016, Warren Buffett started what would become the most profitable investment in his legendary career. Through his company, Berkshire Hathaway Corp. (BRK.A), he began accumulating shares in Apple Inc. (AAPL), first buying about $1 billion worth and soon accumulating another $39 billion. When BRK.A started selling about half of its Apple holdings, the shares were worth over $150 billion.

While the tech giant might seem an unlikely choice for an investor famous for avoiding technology stocks, it illustrates the principles that have made Buffett one of history’s most successful investors.

Why Buffett Invested in Apple

When Buffett began buying Apple shares in late 2016, many market observers were surprised—he had famously avoided technology stocks for decades, claiming they were outside his “circle of competence.” However, Buffett saw something in Apple beyond its classification as a tech company—a consumer brand with unprecedented loyalty and pricing power.

Berkshire Hathaway invested about $40 billion to build what would become the company’s largest holding. By the last quarter of 2023, that position had grown to more than a staggering $150 billion, making it the most profitable investment in Buffett’s storied career.

However, in a dramatic shift, Berkshire began reducing its Apple stake by 56% between October 2023 and June 2024, selling over 515 million shares.

The Apple investment showcases several classic Buffett principles:

• Looking beyond surface classifications to see the true nature of a business
• Having the courage to make large investments when prospects arise
• Maintaining discipline through market volatility
• Understanding when to trim positions

Why Buffett Began Selling Berkshire’s Apple Holdings

In 2024, Buffett explained his selling of Apple shares as partly motivated by the need to corral the largest amount of cash ever held by a public company to face what he felt was a turbulent market period ahead.

But he also noted that a major reason was that it would be beneficial for the company’s taxes. However, Buffett then underlined his broader views on corporate taxes, taking a tact not often heard from Wall St. CEOs—that his company isn’t paying enough in taxes:

“We don’t mind paying taxes at Berkshire, and we are paying a 21% federal rate on the gains we’re taking in Apple. … I would say, with the present fiscal policies, I think that something has to give….We always hope, at Berkshire, to pay substantial federal income taxes. We think it’s appropriate that a company, a country that’s been as generous to our owners [should pay more]. And if 800 other companies had done the same thing, no other person in the U.S. would have had to pay a dime of federal taxes.”

The Bottom Line

While Buffett’s decision to start reducing Berkshire’s Apple stake, initially by 56% between 2023 and 2024, might seem to contradict his buy-and-hold philosophy, it actually reinforces his most important lessons: great investing requires both conviction to hold positions for the long term and the wisdom to adjust when circumstances change.

The key isn’t about finding the next Apple—it’s about adopting the principles that guided these investments. Look for companies with strong brands, loyal customers, and pricing power, while being disciplined enough to take profits when position sizes grow too large.