Berkshire Hathaway Profits Dip on Insurance Woes
Warren Buffett’s Berkshire Hathaway reported a drop in quarterly profit, pressured by weak results from its core insurance operations. The conglomerate also took a substantial writedown on its investment in Occidental Petroleum, highlighting risks in its concentrated energy bets.
The drop in operating profit amounted to a 30% decrease, falling to $10.2 billion from $14.53 billion in the same quarter the previous year. For the full year, operating profit saw a 6% decline to $44.49 billion. The insurance operations weakness stemmed from multiple factors. Insurance underwriting profits plummeted by 54% to $1.56 billion, while income from investing insurance premiums fell nearly 25% to $3.1 billion. The writedown on Occidental Petroleum totaled $4.5 billion. This follows another significant impairment charge of $3.76 billion taken on Berkshire's Kraft Heinz investment earlier in 2025. Despite the writedown, Berkshire stated it has no plans to sell its 26.9% stake in the oil company. This report marks the first with Greg Abel as Chief Executive Officer, a role he assumed in January 2026. Warren Buffett remains chairman. In his first annual letter, Abel paid tribute to Buffett and vowed to maintain his investment discipline. Performance across Berkshire's other businesses was mixed. Profit at the BNSF railroad increased by 6%, while profit from energy operations declined by 5%. The company's manufacturing, retail, and service businesses saw a combined profit increase of 3%. The company's cash hoard remained substantial, ending the year at $373.3 billion. This quarter was also the 13th in a row that Berkshire sold more stocks than it purchased and the sixth consecutive quarter without any share buybacks.
