Berkshire Hathaway (BRK.B), concluding its latest year steered by Warren Buffett, disclosed on Saturday that its fourth-quarter operating earnings amounted to $10.2 billion, marking a 29.8% decline year-over-year, primarily attributable to softness within the insurance division.
The preceding year’s operating profit was approximately $44.5 billion, showing a 6% drop compared to the year prior. The Omaha, Nebraska, conglomerate further reported that net income decreased to $19.2 billion from $19.69 billion in the same period last year.
Last year, Berkshire generated $7.2 billion from insurance underwriting, a 19.5% reduction relative to 2024 figures. Berkshire’s insurance underwriting segment remains spearheaded by the Geico insurance company, which, according to the filing, is grappling with weaker customer retention following substantial rate hikes implemented in recent years.
This report signifies the inaugural year where the annual letter to Berkshire shareholders was not penned by the 95-year-old Buffett, whose frugal financial wisdom has been essential reading for countless investors. The Oracle of Omaha announced in May 2025 his intention to step down at year-end, naming long-time lieutenant Greg Abel as his successor. Abel now takes the helm after Buffett’s six decades of leading the renowned firm.
In his debut letter, Abel sought to reassure investors that Berkshire remains a secure vehicle for capital, with its core tenets staying intact.
“Investing in Berkshire has long been a vote of confidence in our founder—a trust that now belongs to Berkshire. Your capital is mingled with ours, but it is not ours. Our role is to guard it. This stewardship has shaped the culture and reinforced the set of values that are not a product of our success, but the cause of it,” Abel wrote in his initial annual memo to shareholders.
Abel pointed out that while Buffett remains Chairman of Berkshire, the celebrated investor is present in the office five days a week and continues to be an owner.
It has been nearly five years since Abel, associated with Berkshire since 2000, was first named as the incoming CEO. Charlie Munger, who served as Vice Chairman of Berkshire from 1978 until his passing in 2023, once asserted that Abel would “preserve the culture,” while Buffett remarked last year that his successor would be a “more activist” leader.
“We will face business successes and failures. When we fail, we will own it. Doing the right thing also means correcting our mistakes,” Abel stated, adding that the company will “act decisively and ruthlessly” when a “small minority” falls short of standards.
Berkshire’s cash holdings are on the rise. The company’s cash and treasury bills rocketed to a record $373.1 billion, though Abel clarified that the massive pile of cash does not signal a “retreat” from investing, as the firm will maintain a “patient and disciplined” approach regarding beneficial owners.
Abel will preside over the company’s annual shareholder meeting, famously dubbed “Woodstock for Capitalists,” scheduled for May 2nd.
Although Buffett will not be the brand mascot for Squishmallows or cardboard cutouts at the event, the former CEO noted last year that Abel “also understands that if you start deceiving your shareholders, pretty soon you start believing your own B.S. and you start deceiving yourself too.”
“It is a deep honor to take on the responsibility to continue to steward our company and partnership in the years ahead. We are moving forward with great intention and purpose,” Abel concluded.
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