Berkshire Exits Amazon Completely, Pivots to Macy's in Surprising Q1 Move

Warren Buffett's Berkshire Hathaway has completely liquidated its long-held Amazon position in the first quarter of 2026, marking a notable shift in the investment conglomerate's portfolio strategy. The company simultaneously initiated a new position in Macy's, purchasing nearly 1.7 million shares valued at approximately $30.1 million. This seemingly counterintuitive move—abandoning a mega-cap tech darling for a traditional department store—signals Berkshire's evolving perspective on valuations and market opportunities in an uncertain economic environment.

The Exit and New Position: Numbers and Timeline

Berkshire's complete exit from Amazon ($AMZN) represents the final chapter of a investment thesis that had endured for years. The conglomerate held 10 million shares as recently as September 2025, establishing a substantial position in one of the world's most dominant technology companies. By Q1 2026, however, no Amazon shares remained on Berkshire's books—a complete capitulation that caught market observers by surprise.

In stark contrast to the Amazon exit, Berkshire initiated fresh capital deployment into Macy's ($M), one of America's most storied but struggling department store operators. The investment details reveal:

• 1.7 million shares purchased during the quarter
• Total investment value: $30.1 million
• Implied share price: Approximately $17.71 per share at acquisition
• Position type: New initiation rather than addition to existing stake

The timing of these transactions—occurring simultaneously rather than sequentially—underscores Berkshire's deliberate reallocation of capital across distinctly different asset classes and valuation profiles. The moves occurred during a period of broader economic uncertainty, suggesting Berkshire identified what it perceived as mispriced opportunities in the retail sector.

Market Context: Retail Disruption vs. Valuation Disconnect

Berkshire's pivot from Amazon to Macy's cannot be understood without examining the broader retail and technology landscape. Amazon has long represented a paradigmatic technology investment—a company that disrupted retail, dominated e-commerce, and became a critical infrastructure player through AWS, its cloud computing division. Yet by 2026, Amazon's valuation multiples had expanded considerably from historical levels, potentially reducing the margin of safety that guides Berkshire's investment philosophy.

Macy's, conversely, represents a deeply distressed asset class. The traditional department store sector has endured existential pressure from:

• Accelerating e-commerce adoption
• Changing consumer shopping habits
• Erosion of mall-based retail
• Structural challenges in the apparel and home goods markets

Macy's specifically filed for bankruptcy reorganization in early 2023 and emerged with a restructured capital base. By early 2026, the company had undergone significant transformation, including store closures, inventory optimization, and renewed focus on profitability. Trading at a fraction of its historical valuations, Macy's represented the type of "cigar butt" opportunity—cheap, unfashionable, but potentially offering substantial asymmetric return potential—that has historically attracted Berkshire's capital.

This positioning aligns with broader market trends favoring value over growth. In the macro environment of 2026, inflation concerns, higher interest rates, and economic uncertainty had triggered a significant repricing of technology stocks while creating opportunities in traditionally overlooked sectors.

Investor Implications: What Berkshire's Shift Signals

For investors monitoring Berkshire Hathaway ($BRK.A, $BRK.B), this portfolio reallocation carries several critical implications:

Valuation Discipline: The complete exit from Amazon suggests Buffett's team determined the company's valuation no longer reflected an adequate margin of safety, a foundational principle of Berkshire's investment approach. Despite Amazon's operational excellence and market dominance, the price had apparently disconnected from intrinsic value in Berkshire's assessment.

Opportunistic Capital Deployment: The Macy's purchase demonstrates Berkshire's willingness to deploy capital into deeply unfashionable assets when valuations become compelling. This reflects confidence in management's restructuring efforts and the company's ability to generate cash flows despite secular headwinds.

Shift in Market Outlook: The timing suggests Berkshire may be rotating toward defensive, value-oriented positions as it perceives economic risks on the horizon. Retail, particularly traditional department stores, typically benefits from dividend reinvestment and trades at depressed valuations that offer downside protection.

Rebalancing Strategy: For a conglomerate the size of Berkshire—with tens of billions in equity positions—these moves represent meaningful portfolio rebalancing rather than opportunistic day trading. The scale suggests conviction in a medium-term thesis about Amazon's reduced attractiveness and Macy's improved positioning.

For equity investors broadly, Berkshire's moves provide a contrarian signal: while most institutional investors maintain overweight positions in mega-cap technology stocks, Berkshire is exiting entirely. Conversely, while many institutional investors have abandoned brick-and-mortar retail, Berkshire is initiating positions in restructured retail franchises.

Looking Ahead: The Macy's Thesis and Beyond

The coming quarters will reveal whether Berkshire's Macy's investment thesis proves prescient or misguided. The company must execute on several critical initiatives:

• Same-store sales stabilization in remaining locations
• Profitability expansion as cost structure optimization matures
• Digital integration to compete effectively with pure-play e-commerce
• Real estate optimization from owned properties

Meanwhile, the complete Amazon exit removes Berkshire from further upside participation in one of the world's most important companies. If Amazon continues appreciating—particularly if AWS accelerates or artificial intelligence initiatives prove transformative—Berkshire will have forgone substantial gains. Yet from Berkshire's perspective, the price paid for Amazon shares was simply too high to justify continued ownership, regardless of the company's fundamental quality.

This portfolio repositioning underscores a critical investment principle: even the best companies become poor investments at sufficiently high prices, while even challenged companies become attractive investments at sufficiently low prices. Berkshire Hathaway's pivot from Amazon to Macy's represents a disciplined application of this timeless wisdom, even when it requires abandoning a beloved holding for an unfashionable one.