On February 28, 2026, from Omaha, Nebraska, Berkshire Hathaway officially released its 2025 Annual Shareholder Letter. This marks the first letter authored by new Chief Executive Officer Greg Abel, signaling the global investment empire's formal entry into the "post-Buffett era."
Abel began the letter by reassuring the market, stating clearly that 95-year-old Warren Buffett remains Chairman and is "at his post five days a week." Addressing intense market focus on Berkshire's future direction, Abel acknowledged: "Simple arithmetic shows I cannot serve as CEO for 60 years like Warren; that goal is simply too grand. But I hope that twenty years from now, you or your descendants will be proud that Berkshire has grown even stronger."
The company maintains a formidable defensive position regarding capital allocation and financial reserves. In 2025, Berkshire's holdings of cash and U.S. Treasuries surpassed $370 billion, reaching a new record high.
Countering external skepticism that holding substantial cash implies forgoing investment opportunities, Abel directly refuted this notion. He emphasized that this massive reserve supports insurance operations and acts as a strategic asset providing stability during financial storms. "Our goal remains to hold equity in businesses with enduring earning power, not simply to hold U.S. Treasuries," he stated. Following this logic, Berkshire decisively acquired two companies in 2025: OxyChem and Bell Laboratories.
On the highly anticipated topic of shareholder returns, Abel provided a firm response regarding dividends: "Our principle on cash dividends remains unchanged: as long as each dollar of retained earnings generates more than one dollar of market value for shareholders, Berkshire will not pay a cash dividend." He also clarified that share repurchases remain the preferred method when the stock price trades below a conservatively calculated intrinsic value.
With the artificial intelligence boom, massive power demand from data centers has become a market focus. Berkshire Hathaway Energy, a significant part of Berkshire's non-insurance operations, is in a major investment cycle. Abel demonstrated strong commercial discipline, noting that infrastructure built for hyperscale data centers and cloud computing firms should be funded by the relevant customers, reflecting the risks of significant long-term demand fluctuations. "We will only proceed with such incremental investments when risks and rewards are balanced," he said.
Furthermore, addressing frequent wildfire risks in the Western U.S. and substantial claims faced by utility companies, Abel firmly drew a line: "PacifiCorp is not the ultimate risk-bearer and should not be treated as an ATM. Where no liability exists, the company will defend its rights through legal channels."
Examining core financial data, Berkshire reported 2025 operating earnings of $44.5 billion, down from $47.4 billion in 2024 but above the five-year average of $37.5 billion. Net cash flow from operating activities reached a robust $46 billion.
Berkshire's foundational insurance business performed exceptionally well. At the end of 2025, insurance float soared to $176 billion, doubling from $88 billion a decade ago. The combined ratio for property and casualty insurance reached an excellent 87.1%.
However, Abel also issued a forward-looking warning. He noted that as significant capital flows into the insurance and reinsurance markets, pricing has declined or rate increases have slowed for several important lines of business. "We always prioritize underwriting discipline over business volume. Consequently, premium growth has stalled as pricing attractiveness waned. We expect the primary insurance segment to face ongoing market pressure in 2026 and beyond," he stated.
Under the decentralized management model, Abel showed a highly pragmatic, even stern, attitude toward underperforming businesses. Regarding BNSF Railway, one of North America's six major freight railroads, Abel noted that while its operating ratio improved to 65.5%, a "significant gap remains compared to industry leaders." He issued a clear warning: "The team understands the importance of this opportunity. We would be deeply disappointed if substantial performance improvements are not achieved in the coming years."
Regarding the equity investment portfolio, Berkshire continued its highly concentrated strategy. As of the end of 2025, the combined market value of core U.S. holdings and the stakes in five major Japanese trading houses totaled $194 billion, representing two-thirds of the nearly $300 billion equity portfolio and generating $2.5 billion in dividends that year. Abel stated, "We will continue this concentrated investment strategy, exercising restraint in adjusting core positions." He also openly acknowledged that the investment in Kraft Heinz has "fallen far short of reasonable expectations."