Greg Abel Issues First Letter as Berkshire Reports $4.5 Billion Write-Down

2026-02-28 companies

Omaha, Saturday, 28 February 2026.
New CEO Greg Abel signals a fresh chapter by revealing a $4.5 billion write-down on Kraft Heinz and Occidental assets, marking a decisive start to the post-Buffett era.

A Decisive Start to a New Era

On Saturday, February 28, 2026, the transition of power at Berkshire Hathaway became tangible as Greg Abel released his first annual letter to shareholders, a duty performed by Warren Buffett for over six decades [1][2]. While Abel officially assumed the role of CEO in January, this disclosure marks his first major public communication setting the tone for his leadership [1]. The most significant revelation in the report was a $4.5 billion write-down on the value of the conglomerate’s stakes in Kraft Heinz and Occidental Petroleum [1]. This accounting move suggests a desire to clear the decks and reset valuations as the company moves forward under new operational management.

Financial Performance and Insurance Strength

Alongside the strategic write-downs, Berkshire Hathaway reported its financial results for the fourth quarter of 2025. The company posted net earnings per average equivalent Class A share of $13,349 [3]. Despite the robust figures per share, reports indicate a 2.5% decline in fourth-quarter profit compared to previous periods [4]. A bright spot remained the company’s massive insurance operations; the insurance float—capital held from premiums before claims are paid—reached approximately $176 billion as of December 31, 2025 [5]. This represents a growth of 5 billion dollars, given the stated $5 billion increase from the end of 2024 [5]. Furthermore, investment gains provided a significant tailwind, contributing $9.6 billion in the fourth quarter and totaling $12.9 billion for the full year of 2025 [5].

Strategic Portfolio Realignments

The earnings report also illuminates the final strategic maneuvers orchestrated by Warren Buffett before he handed over operational control on December 31, 2025 [6]. In a move signaling caution regarding the broader market and potential tax implications, Berkshire aggressively reduced its exposure to the technology sector in late 2025 [6]. The firm halved its stake in Apple and reduced its Amazon holding by 77% [6]. Consequently, the company has amassed a historic cash position, surpassing the levels seen prior to the 2008 financial crisis, as it shifts focus toward defensive legacy businesses and hard commodities [6]. This includes a total exposure to hard resources exceeding $100 billion, with significant stakes in energy and rail assets like BNSF and Chevron [6].

Continuity Amidst Change

While the write-downs and portfolio adjustments indicate a sharpening of strategy, the overarching message remains one of continuity. In his letter, Abel paid tribute to Buffett and pledged to maintain the distinct culture that has defined the company [1]. Although Buffett has stepped down as CEO, he remains the Chairman and largest shareholder, continuing to offer guidance to the firm he built [1]. Investors will now look toward the shareholder meeting in May, where Abel is set to be the sole executive answering questions, a symbolic final step in this historic corporate succession [1].

Sources

Succession Warren Buffett