Buffett to step down following 6-decade run atop Berkshire

Warren Buffett, who built Berkshire Hathaway Inc. into a business valued at more than $1.16 trillion and himself into a celebrity billionaire renowned for his investing acumen and witticisms, will step down at year-end after six decades atop the conglomerate.

Greg Abel, the vice chairman for non-insurance operations, will take charge of the conglomerate upon board approval, Buffett, 94, said Saturday at the company's annual shareholder meeting in Omaha, Nebraska. He said the board plans to meet on Sunday.

The announcement stunned the board and even Abel, who, while long signaled as Buffett's successor, was unaware that the news was coming as the annual meeting drew to a close.

"That's the news hook for the day," Buffett said. "Thanks for coming."

Berkshire grew aggressively over the decades with Buffett as chairman and CEO, as he chose acquisitions and stocks for the company portfolio alongside trusted adviser and vice chairman, Charlie Munger, who died in 2023 at 99. The conglomerate acquired a bewildering assortment of businesses, which Buffett often said mirrored the U.S. economy as a whole. A bet on Berkshire, he said, was a bet on America.

"The world is Berkshire's oyster — a world offering us a range of opportunities far beyond those realistically open to most companies," Buffett said in his annual letter released in 2015.

Buffett had the ear of fellow CEOs and some presidents, and was able to draw a crowd of tens of thousands of shareholders to Omaha every year for the annual meeting.

His investing success, a 20% compounded annual gain in Berkshire stock between 1965 and 2024, compared with about 10% for the S&P 500, gave him the power to move stocks and helped him strike lucrative deals with Goldman Sachs Group Inc. and General Electric Co. during times of crisis.

Buffett started managing money when he was young, a disciple of Benjamin Graham's investing style. He moved more into the corporate world when his Buffett Partnership Ltd. bought shares of Berkshire. In 1965, he took control of the rest of the business.

Composed mostly of struggling textile operations that would eventually fade away, Berkshire became the foundation for Buffett's modern-day giant. Piece by piece, he built and acquired operations into a varied set of industries, including insurance — which gave him cash, or "float" — to help his investing strategy.

Now, Berkshire owns businesses ranging from railroad BNSF to auto insurer Geico, sprawling energy operations, and even retailers such as Dairy Queen and See's Candies. Its collection of companies generated $47.4 billion of annual operating earnings in 2024. Buffett also built up the stock portfolio — populating it with giant bets on the likes of Apple Inc. and American Express — and offering Berkshire another way to participate in the gains of businesses that it didn't fully own.

'All-in wager'

When Buffett agreed to buy BNSF for $26 billion in 2009, he called the deal an "all-in wager on the economic future of the United States." The billionaire rarely missed a chance to extol the prospects of the U.S. economy.

An "all-powerful trend" toward more productivity made the country great, he wrote in a 2015 annual letter. Over the course of his lifetime, the nation's economic output had risen sixfold per capita, "a leap far beyond the wildest dreams of my parents or their contemporaries," he wrote.

Abel, 62, a longtime Buffett deputy, will be taking over a healthy business. While Berkshire just reported first-quarter operating earnings declined 14% to $9.6 billion after heavy losses in its insurance unit related to California wildfires, its increased holdings of Treasury bills helped lift investment income.

Scarce deals

During the pandemic, Buffett was stymied on the dealmaking front due to high valuations for good businesses, leaving a swollen cash pile and few attractive opportunities to put money to work. Instead of deals, Buffett leaned into share buybacks to deploy capital, though he broke with that trend by completing a $11.6 billion acquisition of Alleghany Corp. in 2022.

Last year, he decried a lack of meaningful deals that would give the firm a shot at "eye-popping performance" as Berkshire's cash pile hit yet another record. The few U.S. companies capable of moving the needle at Berkshire had already been "endlessly picked over by us and by others," he said.

Since then, as the billionaire cut his stakes in Apple and Bank of America Corp. while refraining from making major deals, Berkshire's cash pile kept piling up, reaching $347.7 billion as of March 31.

There were also some occasional missteps. Buffett conceded he paid too much for aerospace-equipment maker Precision Castparts, a deal that forced a $10 billion writedown in 2020. And Buffett and Munger were famously late to seeing value in technology stocks, though they later accelerated purchases of Apple shares.

Still, his long-term track record has attracted fans for years. At the annual meetings held in a crowded Omaha sports arena, he and Munger would opine on topics ranging from stock markets to cryptocurrency and even life and success. The annual event, nicknamed Woodstock for Capitalists, and his widely read annual letter both played into the investor's fascination with teaching others.

Fans of the billionaire often quote his more-memorable quips. Buffett pulled out one of his chestnuts again in 2018 on the question of whether troubled Wells Fargo & Co. — then a longtime Berkshire investment — might uncover additional wrongdoing: "There's never just one cockroach in the kitchen." And of over-leveraged financial firms during the worldwide crisis in 2008 he had this to say: "You only learn who has been swimming naked when the tide goes out."

Despite Buffett's large following, his day-to-day management of Berkshire was simple. He long favored a decentralized management approach, allowing the heads of Berkshire's various businesses to run the operations how they deemed fit and checking in on the operations every now and then.

Buffett considered one of his more important roles to be a capital allocator for Berkshire, figuring out where the money should go, and reportedly spent a lot of time reading in his corporate office in Omaha. That office had just 27 employees as of last year.

"Buffett's decision to limit his activities to a few kinds and to maximize his attention to them, and to keep doing so for 50 years, was a lollapalooza," Munger said in an annual letter. "Buffett succeeded for the same reason Roger Federer became good at tennis."