I took a deep dive into tech. Like most value investors, I had sniffed at tech companies' lofty valuations. But two things occurred to me. The tech companies of the 2010s weren't the tech companies of the dot-com era. Google [now Alphabet] and Amazon.com had become battleships. They were durable, branded franchises with strong businesses. Second, while they were optically expensive, if I loosened up the rigid value framework I had adhered to for my entire investment career.

Berkshire owned 51% of Geico and agreed in 1995 to buy the rest. In the last year in which it published financials, Geico had $250 million of net income and spent $30 million marketing its products. Within a few years of the acquisition, reading between the lines, Geico was spending $250 million on marketing. Accounting rules forced the company to run 100% of these expenses through the P&L, which depressed earnings. It couldn't capitalize them, unlike a manufacturer.

Yet, functionally, the marketing was a factory in the sense that it had a long life. Geico had to spend up front to acquire customers, and then they would stay with the company, generating more revenue. As Buffett said in his 1999 annual report, he was investing today for tomorrow. And this is exactly what Amazon, Alphabet, and Intuit are doing'investing to grow. It isn't crazy math. But GAAP accounting, codified in the 1930s when industrial companies ruled the roost, wasn't designed for today's tech companies. It penalizes outlays for marketing and research and development by forcing such long-term investments to be accounted for as one-year expense items.

stocks.apple.com: Amazon, Alphabet, and Other Growth Stocks Appeal to This Value Investor