Berkshire Hathaway released its final financial report before Warren Buffett steps down as CEO, revealing the company's continued market caution despite profit growth, with its cash reserves ballooning to a record $381.7 billion.
From July to September, Buffett's conglomerate sold more stocks than it bought, maintaining a $283.2 billion equity portfolio that includes holdings in Apple and American Express. This marks the 12th consecutive quarter of net stock sales.
Berkshire also refrained from repurchasing its own shares for the fifth straight quarter, even as its stock performance lagged significantly behind the broader market.
**Buffett Prepares to Exit, Abel Steps In** The 95-year-old Buffett is set to conclude his six-decade tenure as CEO by year-end, allowing cash to accumulate further.
Greg Abel, the 63-year-old vice chairman, will succeed the legendary investor, though Buffett will remain as chairman.
Abel is known to be a more hands-on manager than Buffett, but his plans for Berkshire's cash—which may include paying the conglomerate's first dividend since 1967—remain unclear.
In early October, Berkshire announced a $9.7 billion cash deal to acquire Occidental Petroleum's OxyChem chemicals business.
**Net Income Rises on Investment Gains** Third-quarter operating profit rose 34% to $13.49 billion, or $9,376 per share, up from $10.09 billion a year earlier.
The improvement was driven by lower expected losses in some of Berkshire's insurance and reinsurance businesses, though underwriting profits at Geico declined due to higher spending on new policies.
Including gains from stock investments, net income climbed 17% to $30.8 billion, or $21,413 per share, compared with $26.25 billion in the same period last year.
Buffett downplays net income figures, as they include unrealized gains or losses on stocks Berkshire hasn't sold—adding volatility he deems irrelevant for assessing the company's performance.
**Stock Lags Behind Market** Investors have expressed concerns over Berkshire's outlook and the impending leadership transition by selling shares.
Since Buffett announced his departure on May 3, Berkshire's stock has fallen 12%, underperforming the S&P 500 by 32 percentage points. Year-to-date in 2025, Berkshire trails the index by 11 points.
The conglomerate owns nearly 200 businesses, spanning utilities, renewables, chemicals, industrials, and consumer brands like Dairy Queen, Fruit of the Loom, and See's Candies.
Berkshire hasn't made a major acquisition since its $32.1 billion purchase of Precision Castparts in 2016, though it later added Pilot Travel Centers for $13.6 billion and Alleghany Insurance Holdings for $11.5 billion.