In his inaugural letter to shareholders, Greg Abel drew upon his predecessor's philosophy.

Key Highlights: Greg Abel detailed his vision for leading Berkshire Hathaway in his first shareholder letter, providing insights into his perspective on the company's core operations.

Berkshire Hathaway's new CEO Greg Abel is setting the tone for the American conglomerate. In his Saturday letter, Abel stated he would follow the blueprint Warren Buffett created decades ago - transforming a struggling textile mill into a vast diversified empire. He confirmed that Buffett currently advises him five days a week on insurance underwriting, stock selection, and other matters.

Abel clearly signaled that his era at Berkshire has begun. Mirroring Buffett's historical approach, he systematically addressed each of Berkshire's core business segments: insurance operations, operating subsidiaries, equity investment portfolio, acquisition strategies, and other capital allocation methods.

Insurance Operations: Abel wrote that insurance remains the conglomerate's core business, with its crucial value lying in "float" - premiums paid by policyholders in advance - which enables Berkshire to purchase stocks, other securities, and even entire companies. At the end of 2025, Berkshire's insurance float reached $176 billion, up from $171 billion the previous year.

Continuing Buffett's style, Abel strongly praised insurance chief Ajit Jain, known for his exceptional pricing abilities, including unconventional policies like terrorism insurance for Chicago's tallest building and a $1 billion lottery prize policy for PepsiCo.

"Accurately pricing insurance risk is critical; if the price isn't right, we walk away," Abel wrote. "No one does this better than Ajit."

Diversified Operations: Abel indicated he would largely refrain from interfering with subsidiary CEOs across businesses from railroads to footwear, similar to Buffett's approach. However, he previously stated that as vice chairman overseeing non-insurance operations, he has been more hands-on than Buffett. Buffett and former vice chairman Charlie Munger preferred greater delegation.

"We operate a decentralized model, granting autonomy based on deep trust," Abel wrote. "In return, we expect accountability for performance and unwavering integrity."

Equity Portfolio: Abel wrote that he will personally manage Berkshire's stock portfolio, as Buffett did during his CEO tenure. Fund manager Ted Weschler handles approximately 6% of investments, including portions previously managed by another investing deputy Todd Combs, who recently left to join JPMorgan.

He stated Berkshire will maintain its concentrated investment strategy, citing holdings including Apple, American Express, Coca-Cola, and Moody's. Notably absent from his list were two major positions: Bank of America and Chevron.

Abel expressed clear dissatisfaction with underperforming companies, calling Berkshire's investment in Kraft Heinz "disappointing." Kraft Heinz planned to separate its condiments and everyday foods businesses last year but abandoned the plan in February. Weeks ago, a filing suggested Berkshire may have nearly eliminated its 325.6 million share position.

Last year, Berkshire recorded a $3.8 billion after-tax write-down on its Kraft Heinz investment, remeasured at fair value. Berkshire attributed this to the food company's struggles with inflation, shifting consumer preferences, and ongoing strategic reviews. Berkshire executives have also departed from Kraft Heinz's board.

Mergers and Acquisitions: Abel stated that, like Buffett, he prefers owning operating companies over U.S. Treasuries. After deducting payables for short-term government debt purchases, Berkshire's cash and equivalents soared to a record $373.1 billion at 2025 year-end.

"More opportunities to deploy shareholder capital will undoubtedly arise in the future," Abel wrote. "We will evaluate value carefully, act patiently, and hold for the long term - preferably permanently."

Dividends and Share Buybacks: Abel stated Berkshire will repurchase shares when the stock price falls below its estimated intrinsic value.

Berkshire conducted no share repurchases in 2025. Since reaching its all-time high of $809,350 per share on May 2, the day before Buffett announced his retirement, the company's Class A shares have declined 6.5%. According to financial data provider FactSet, its recent price-to-book ratio is approximately 1.6 times, above its 10-year average of 1.4 times.

Abel also suggested that despite substantial cash reserves, Berkshire won't rush to pay dividends. The company has only paid a dividend once in its history, in 1967. Buffett long opposed dividends, partly due to shareholder tax considerations and partly because he believed reinvesting cash would deliver higher returns for shareholders.