(Bloomberg) — Berkshire Hathaway Inc. Chief Executive Officer Greg Abel vowed to keep Warren Buffett’s guiding principles intact and sought to reassure investors that the company would outlast the legendary executive.
Abel began his inaugural letter to shareholders, published on Saturday as part of the company’s annual report, with a tribute to Buffett, the billionaire investor who ran the company for more than six decades with a focus on seeking out value and investing over the long term.
“Warren is obviously a very hard act to follow,” Abel, 63, wrote.
He called Buffett “arguably the greatest investor of all time,” but said his mentor notched an equally impressive achievement in building Berkshire into a lasting enterprise, along with longtime business partner Charlie Munger. The CEO promised the firm’s core values — capital discipline, integrity and investing for the long run — will remain unchanged.
“Twenty years from now, when I will have just a fraction of the tenure that Warren had, my intention is that you – or your descendants – will be proud that your company is even stronger,” Abel wrote.
Abel reaffirmed Berkshire’s shareholder returns policy, saying the firm will buy back its own shares when he believes, after consulting Buffett, that they trade below their intrinsic value.
He also said the firm will abstain from paying a dividend as long as “more than one dollar of market value for shareholders is reasonably likely to be created by each dollar of retained earnings,” and that it will not retreat from investing.
‘Cult of Personality’
The letter was an otherwise straightforward review of the company’s operations, as Abel sought to strike a balance between finding his own voice while staying true to the company’s ethos.
“Abel is trying to overcome the cult of personality that often prevents investment firms from surviving a leadership transition,” said Christopher Davis of Hudson Value Partners.
Abel also said he doesn’t plan to change how the firm communicates with investors. Berkshire, the only public company of its size without an investor-relations function, doesn’t hold any investor-oriented events other than its annual meeting.
“We concentrate on quality, not frequency,” Abel wrote. “If a significant issue arises, you will hear from me, but it will not be through quarterly commentary, given our long-term horizon.”
For Buffett fans, Abel’s first letter to shareholders marks the end of an era. The billionaire’s pearls of wisdom, aphorisms and life advice have turned the trove of letters into a must-read archive.
“It’s sort of what I expected in the sense that there was the appropriate homage to Warren Buffett, the individual, but at the same time an emphasis that the entity of Berkshire Hathaway, the values, the operating policies, the mindset will continue,” Cathy Seifert, an analyst at CFRA Research, said of Abel’s letter.
While overwhelmingly signaling continuity, Abel’s letter also introduced at least one adjustment.
In a departure from tradition at Berkshire, the firm’s next annual meeting in May will feature other business executives from the Berkshire empire: BNSF’s Katie Farmer and NetJets’ Adam Johnson. Investors and analysts have long called for the company to shed light on its deep bench of executives.
The company reported fourth-quarter earnings in a separate statement Saturday. Berkshire said its operating profits fell nearly 30% in Buffett’s last quarter as CEO, as insurance underwriting earnings slumped more than 54%. The company warned of potential challenges for the insurance business because of strong competition and rising claims.
Berkshire also took a $4.5 billion impairment charge in the quarter. It recorded a hit of $8.3 billion related to its Kraft Heinz Co. and Occidental Petroleum Corp. holdings last year.
“Our investment in Kraft Heinz has been disappointing,” Abel said in the letter. “Even after considering the preferred equity component in our original Heinz investment, our return has been well short of adequate.”
Berkshire’s cash pile stood at $373.3 billion, down from $381.7 billion in the previous quarter. Lower interest rates impacted the firm’s proceeds from its cash pile, with its insurance interest and other investment income falling 11.9% over the past year. It was a net seller of equities in the period, unloading $3.2 billion worth of stock.
Berkshire’s annual insurance underwriting pretax earnings fell 17% in 2025 from a year ago. Geico, the main contributor to Berkshire’s insurance results, posted pretax underwriting earnings that fell roughly 13% to $6.8 billion in the year, driven in part by higher advertising expenses to acquire more clients.
Operating earnings at its railroad unit BNSF grew 5.4% to $1.3 billion in the fourth quarter. Berkshire’s utilities business, which runs Pacificorp, MidAmerican and NV Energy, posted a decline in operating earnings of 5.2% to $691 million over the quarter.
The firm declined to buy back its own shares for the sixth straight quarter, even after the stock fell 6.5% after Buffett announced in May that he would step down as CEO at the end of 2025.
(Adds additional commentary from shareholder letter and analysts throughout.)
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