Berkshire After Buffett
The Oracle Steps Down
Dear Investor.
Zee here. After six remarkable decades at the helm, Warren Buffett officially stepped down as CEO of Berkshire Hathaway on December 31, 2025, marking the end of one of the most extraordinary leadership runs in corporate history. At 95 years old, the “Oracle of Omaha” has passed the baton to Greg Abel, who took over as CEO on January 1, 2026.
Here are five key points every investor should understand about this historic transition.
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1. A Legendary Track Record That Defied the Odds
The numbers tell an almost unbelievable story. Since Buffett took control of Berkshire Hathaway in 1965, the company’s stock has delivered a staggering 5,500,000% total return over his 60-year tenure. To put that in perspective, the S&P 500 gained approximately 39,000% during the same period, including dividends.
Berkshire achieved an average annual growth rate of 20%, nearly doubling the market’s 10% return. What began as a struggling textile mill in New England has become the world’s 11th largest company, with a market capitalization exceeding $1 trillion.
2. Mixed Market Reception in 2025
Despite the legendary performance, Berkshire Hathaway’s stock experienced a bumpy final year under Buffett’s leadership. After he announced his retirement plans at the annual shareholders meeting in May 2025, the stock initially dropped 14.4% from its all-time high, falling to its yearly low in August.
The Class B shares ended 2025 up about 10.9%, but this underperformed the S&P 500’s 16.4% gain for the year. Some analysts attribute this underperformance to what they call a “succession discount,” as investors grapple with uncertainty about Berkshire’s future without its iconic leader. The stock currently trades around $496-$499 per share, below its May 2025 peak.
3. Greg Abel: The Chosen Successor
Buffett has expressed complete confidence in his hand-picked successor. Abel, 63, has been groomed for this role for years, overseeing all non-insurance operations since 2018 and serving as CEO of Berkshire Hathaway Energy before that. In his final Thanksgiving letter to shareholders, Buffett praised Abel’s abilities and understanding of the business.
Abel’s compensation reflects his new responsibilities: he’ll earn $25 million annually, a dramatic increase from Buffett’s famously modest $100,000 salary. While Abel has big shoes to fill, Buffett has made it clear that he views Abel as the best person to manage both Berkshire’s operations and its shareholders’ capital.
4. The $381 Billion Question
One of the biggest challenges facing Abel is what to do with Berkshire’s massive cash pile. As of the third quarter of 2025, the company held a record $381.7 billion in cash and equivalents. This enormous sum reflects Buffett’s cautious approach during his final years, as he found fewer attractive investment opportunities at reasonable prices.
Abel is expected to take a more active approach to deploying this capital, potentially focusing on infrastructure projects, green energy initiatives, and strategic acquisitions. He’s also pledged to continue Berkshire’s stock buyback program, which has repurchased over 12% of outstanding shares since 2018. Some investors hope Abel might even initiate Berkshire’s first-ever regular dividend payment.
5. A Legacy Beyond Numbers
While Buffett’s investment returns are legendary, his true legacy extends far beyond financial performance. He championed value investing principles, emphasizing long-term thinking, finding quality businesses at reasonable prices, and giving excellent management teams the freedom to operate. His annual letters to shareholders became required reading for investors worldwide, filled with wisdom, humor, and practical advice.
Together with Bill Gates and Melinda French Gates, he launched The Giving Pledge in 2010, committing to donate his wealth to philanthropic causes. He has already given away more than $60 billion, with more to come. Buffett will remain as chairman of Berkshire’s board, ensuring continuity and providing counsel to Abel during the transition.
A Grateful Farewell
Warren Buffett transformed not just Berkshire Hathaway, but the entire approach to long-term investing. His philosophy was elegantly simple: buy wonderful businesses, hold them forever, and let compound interest work its magic. He lived in the same modest Omaha home since 1952, embodied integrity and discipline, and proved that staying the course through market cycles produces extraordinary results.
As investors, we owe a debt of gratitude to the Oracle of Omaha. He showed us that patience beats timing, that character matters in business, and that treating shareholders as partners builds lasting value. While a new chapter begins for Berkshire Hathaway, Warren Buffett’s influence on investing will endure for generations.
Thank you, Warren, for six incredible decades of wisdom, leadership, and unwavering integrity. The investment world won’t be the same without you at the helm, but your lessons will guide us forever.
Disclaimer: All information here is for educational purposes only. This is not financial advice. Please do your own research and speak with a licensed advisor before making any investment decisions. Past performance is not indicative of future returns. How we invest may not suit your investment goals and risk management profile.