The Berkshire Hathaway stock buyback reached $9.6 billion in the third quarter, the company’s biggest quarterly repurchase of the year, even as its overall profit fell more than 28% in the first earnings report under new chief executive Greg Abel. The numbers, released on Saturday morning, offer the first real look at how the conglomerate is performing now that Warren Buffett has stepped back — and the picture is mixed: the buyback machine is running at full speed, but the insurance business that built Berkshire’s fortune is under real pressure.
Buffett surprised investors when he announced his retirement plans at the annual meeting in May 2025. He gave up the chief executive’s job to Abel in January, then handed over the chairman’s title in September. Abel had run Berkshire’s noninsurance businesses for years, so he is no stranger to the company. But these are the first results that carry his name at the top, and Wall Street was watching closely for any sign of a change in direction.
Berkshire Hathaway Stock Buyback: $9.6 Billion in One Quarter
The headline figure is the buyback itself. Berkshire repurchased $9.6 billion worth of its own shares between July and September, its largest quarterly buyback this year. For years, Buffett treated buybacks as a tool to deploy only when the stock looked cheap relative to the value of the businesses underneath it. The size of this quarter’s repurchase suggests Abel and the board saw that value in the shares — and were willing to act on it while they could.
That window may already be closing. The buybacks likely came to a halt recently as Berkshire’s Class A stock price surged past $878,000, climbing above where it stood before Buffett announced his retirement. At those prices, the company’s own rulebook would argue against buying more. Investors will be watching the fourth quarter closely to see whether the repurchases resume if the price dips, or whether the $9.6 billion was a one-off burst.
Profit Falls 28% as Geico Struggles
The profit line tells a different story. Berkshire reported a net profit of $22.1 billion, or $15,502 per Class A share, down from $30.8 billion, or $21,413 per share, in the same quarter last year. That is a drop of more than 28%. But Berkshire’s bottom line has always been a noisy number, because it includes the changing value of the company’s huge investment portfolio. A bad quarter for the stock market can make the profit figure plunge even when the underlying businesses are doing fine.
That is why the company has long told investors to watch operating earnings instead — the profit from the dozens of businesses Berkshire actually owns and runs. Even on that cleaner measure, though, the quarter was soft. Operating earnings slipped nearly 6% to $12.7 billion, or $8,907 per Class A share, down from $13.485 billion, or $9,376.15, a year ago. The one bright spot: four analysts surveyed by FactSet had predicted operating earnings of $8,821.84 per Class A share, so the result came in slightly ahead of expectations.
The main drag was insurance. Underwriting profit across all of Berkshire’s insurers fell to $1.35 billion from $2.37 billion a year earlier, and Geico accounted for most of the damage. The car insurer generated $982 million in underwriting profit, down from $1.77 billion a year ago — a near-halving that will worry shareholders who remember Geico as one of Berkshire’s most reliable earners.
CFRA Research analyst Cathy Seifert said Geico is caught in a squeeze, with insurance premiums declining at the same time as the average cost of claims keeps rising. It is a tough combination for any insurer, and it helps explain why the numbers look as weak as they do.
Not everyone is alarmed. Investor Chris Ballard, managing director at Check Capital, said he was not disappointed in Geico’s numbers, because they reflect a company that is investing again — spending more on advertising and leaning back into its iconic spokeslizard to win customers. Writing new policies aggressively almost always puts pressure on an auto insurer’s bottom line in the short term. “It should be looking better. Progressive is doing better, but they were doing so well for so long. They had cut their advertising for quite a while there,” Ballard said. “So we’ve been kind of expecting this on our end.”
Cash Pile Grows to $377.4 Billion
One number that keeps moving in Berkshire’s favour is the cash pile. It returned to growing in the third quarter and reached $377.4 billion, up from $365.5 billion at the end of June. That is an enormous war chest by any measure — larger than the entire market value of most companies on the stock market — and it gives Abel options his predecessor never had to rush into using.
The question is what he does with it. Buffett spent years sitting on the cash, saying he could not find a deal big enough and cheap enough to be worth doing. The pile grew and grew, and shareholders largely trusted his patience. Abel now inherits both the money and the expectation that he will eventually find something to do with it, whether that means a major acquisition, more buybacks, or simply waiting for the right moment.
There is a case for patience. The market backdrop is unsettled — the Nasdaq’s $2 trillion sell-off this week showed how quickly sentiment can turn — and a buyer with nearly $380 billion in cash is in a strong position when prices fall. But there is also a limit to how long investors will wait before they start asking harder questions about the plan.
Abel’s Strengths Are Showing
Seifert, the CFRA analyst, offered a view that may reassure shareholders: the businesses Abel has overseen for years — manufacturers such as Precision Castparts, the utilities and the BNSF railroad — seem to be performing better than the massive insurance unit, even without the help of major hurricanes or other catastrophes this year. “I think we’re seeing the businesses that play to Greg’s strengths do well. But the question is what about the rest of the franchise,” she said.
That is the central question of the Abel era. Berkshire owns a sprawling collection of businesses: several major insurers including Geico, a group of big utilities, the BNSF railroad and a varied assortment of manufacturing and retail companies, including Precision Castparts and See’s Candies. Running them all is a different job from running the noninsurance half, and the insurance results this quarter show how much work there is to do.
What Comes Next for Berkshire
For now, the market’s verdict will hinge on two things: whether Geico can steady itself, and what Abel does with the cash. The buyback shows he is willing to return money to shareholders when the price is right. The profit figures show the operating challenges are real, not just accounting noise. And the growing cash pile shows that the company has the resources to act when an opportunity appears.
The transition from Buffett to Abel was always going to be judged slowly, one quarter at a time. This first quarter gives shareholders reasons for both patience and concern — a big buyback, a soft profit line, a struggling insurer and a record pile of cash waiting for its moment. The full AP report on the results is here: https://www.theheraldreview.com/business/article/berkshire-hathaway-buys-back-9-6-billion-of-its-22518115.php