On May 3, 2025, Warren Buffett and Greg Abel were seen walking through the Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska. Berkshire Hathaway has announced a substantial decline in its operating earnings for the fourth quarter, largely attributed to challenges in its insurance business.
The company's earnings from operations reached $10.2 billion during Q4, representing a decrease of over 29% from the $14.56 billion reported in the corresponding period last year. This quarter marks the conclusion of Warren Buffett's tenure as CEO, following his announcement to step down at the previous annual shareholders meeting. Starting in 2026, Greg Abel has taken over as CEO, committing in Berkshire's annual letter released alongside Saturday's results to uphold the financial strength and disciplined capital culture fostered by Buffett, who remains as chairman.
Insurance underwriting profits fell by 54%, from $3.41 billion to $1.56 billion year-over-year, while insurance investment income decreased by nearly 25%, down to $3.1 billion from $4.088 billion.
For the full-year 2025, operating earnings totaled $44.49 billion, a decline from the $47.44 billion recorded the previous year. Annual insurance underwriting profits stood at $7.26 billion, down from $9 billion in 2024, and insurance investment income for the year decreased to $12.5 billion from $13.6 billion.
Overall earnings, inclusive of gains or losses from Berkshire's stock market investments, dipped slightly in the fourth quarter, reaching $19.2 billion from $19.7 billion in the prior year. These figures were affected by a $4.5 billion impairment from investments in Kraft Heinz and Occidental Petroleum, while investment gains were $13.5 billion.
For the full year, overall earnings decreased to $66.97 billion from last year's $89 billion. However, Berkshire consistently advises investors to focus less on short-term investment performance.
"The amount of investment gains (losses) in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules," Berkshire Hathaway stated in its earnings release.