Berkshire Hathaway Profits Fall
Warren Buffett's Berkshire Hathaway reported a drop in quarterly profit, dragged down by weakness in its insurance operations. The results were also hit by a writedown on its investment in Occidental Petroleum, reflecting turbulence in both the insurance and energy sectors.
Berkshire Hathaway's fourth-quarter operating earnings for 2025 fell by over 29% to $10.2 billion compared to the same period in the previous year. This decline was significantly influenced by a 54% drop in insurance underwriting profits, which decreased to $1.56 billion from $3.41 billion a year earlier. The conglomerate's massive cash pile saw a slight dip to $373.3 billion from a record $381.6 billion in the third quarter. For the thirteenth consecutive quarter, Berkshire sold more stocks than it purchased and did not engage in any share buybacks for the sixth straight quarter. These results mark the final quarter with Warren Buffett as CEO, who stepped down at the end of 2025. His successor, Greg Abel, took over at the beginning of 2026 and penned his first annual letter to shareholders, reassuring them of his commitment to maintaining the company's established culture. Beyond the insurance segment, other parts of the business showed mixed results. The BNSF railroad business saw its operating earnings rise by about 5% to $1.3 billion. Meanwhile, the manufacturing, service, and retailing businesses experienced modest gains despite what the company described as "sluggish" consumer demand. The writedown on Occidental Petroleum amounted to a $4.5 billion impairment charge. Despite this, Berkshire has indicated that it does not plan to sell its 26.9% stake in the oil company, a position Buffett began building in 2019. For the full year of 2025, Berkshire's operating earnings totaled $44.49 billion, a decrease from $47.44 billion in 2024. Full-year net earnings also saw a significant drop of 25% to $66.97 billion from $89 billion the prior year. In his first letter as CEO, Greg Abel emphasized continuity with the strategies established by Buffett. Warren Buffett remains involved with the company as chairman.
