Berkshire Hathaway experienced a decline in its Class A shares, which fell 1.4% on the first day of Greg Abel’s tenure as CEO following Warren Buffett’s retirement after 60 years of leadership. The drop comes as investors reflect on the significance of Buffett’s departure, leaving behind one of the most remarkable legacies in corporate history.
Despite the decline, Berkshire Hathaway concluded 2025 with a 10.9% gain, though this was below the S&P 500’s 16.4% increase. The company has now posted ten consecutive years of positive returns. Buffett, who remains as chairman at 95, expressed confidence in Berkshire’s enduring success, stating that he believes the conglomerate has a better chance of thriving in the next century than any other company.
As of September, Berkshire boasts a record cash reserve of $381.6 billion, positioning the company for future investments. Buffett emphasized Abel’s authority in capital allocation, declaring, “Greg will be the decider.” He praised Abel’s capabilities, stating he is confident in Abel’s management of investments compared to top advisors and CEOs.
Investor sentiment had been cautious following Buffett’s retirement announcement in May, with some questioning whether Abel could replicate Buffett’s successful oversight of the company’s diverse operations and substantial equity portfolio. Buffett’s legacy is unparalleled; he transformed Berkshire from a struggling textile company into an investment powerhouse, achieving a remarkable compounded annual gain of 19.9% from 1964 to 2024, nearly double that of the S&P 500.
Why this story matters: The transition from Buffett to Abel marks a pivotal moment in Berkshire Hathaway’s history, affecting investor confidence and future strategies.
Key takeaway: Greg Abel’s leadership will be scrutinized as he takes over a company with a rich legacy and substantial cash reserves.
Opposing viewpoint: Some investors are skeptical about Abel’s ability to uphold Berkshire’s tradition of excellence and manage its extensive portfolio effectively.
