Greg Abel Succeeds Buffett as CEO as Berkshire Q4 Earnings Drop 29.8%
Gregory Abel took over as Berkshire Hathaway CEO, pledging to uphold its capital discipline and reporting Q4 operating earnings of $10.2B, down 29.8%, and full-year 2025 operating earnings of $44.49B. Berkshire ended 2025 with $373.3B in cash, major equity stakes in American Express (22.1%), Coca-Cola (9.3%), Moody’s (13.9%), Apple (1.6%), $8.5B in Occidental preferred and $194B in Japanese trading firms yielding $2.5B dividends.
1. CEO Transition to Gregory Abel
Berkshire unveiled a leadership transition plan naming Gregory E. Abel as CEO, emphasizing the preservation of its long-standing culture and disciplined capital allocation. Abel acknowledged that 'Warren is obviously a very hard act to follow' in his first annual report letter.
2. Declining Operating Earnings
Fourth-quarter operating earnings fell 29.8% to $10.2 billion from $14.56 billion, while full-year 2025 operating earnings declined to $44.49 billion from $47.44 billion a year earlier. Cash holdings decreased to $373.3 billion despite no share repurchases.
3. Portfolio Composition and Japanese Trading Stakes
The equity portfolio remains concentrated in five companies with stakes of 22.1% in American Express, 9.3% in Coca-Cola, 13.9% in Moody’s and 1.6% in Apple alongside $8.5 billion in Occidental preferred stock liquidation value. Berkshire’s $194 billion invested in Japanese trading firms—including Mitsubishi, Itochu, Mitsui, Marubeni and Sumitomo—generated $2.5 billion in dividends while the company borrowed yen at 1.2% over a 5.75-year weighted maturity.
4. Insurance Arm as Financial Engine
Berkshire’s insurance businesses continue as its financial backbone, with disciplined underwriting and a nonnegotiable focus on integrity. The company maintains over $370 billion in cash and Treasuries, opting to reinvest earnings into productive assets rather than pay dividends.