Greg Abel’s first Berkshire Hathaway annual meeting as chief executive arrived with exactly the kind of mixed message investors should expect from the company’s post-Warren Buffett era. Berkshire reported first-quarter operating earnings of $11.35 billion on May 2, up 18% from $9.64 billion a year earlier, while net income attributable to shareholders more than doubled to $10.11 billion. The headline numbers were strong, but the more important takeaway was not that Abel has already remade Berkshire. It was that Berkshire’s investment case is becoming more straightforward, and in some ways less magical: this is now a story about operating performance, capital discipline, and whether a sprawling industrial and insurance empire can still compound value without leaning on Buffett’s singular aura.
The quarterly results give Abel a credible starting point. Insurance underwriting improved to $1.72 billion from $1.34 billion, BNSF earnings rose to $1.38 billion from $1.21 billion, Berkshire Hathaway Energy edged up to $1.11 billion from $1.10 billion, and manufacturing, service and retailing earnings climbed to $3.20 billion from $3.06 billion. Those gains matter because they show breadth. Berkshire is not relying on one hot business or one market tailwind. It is still a collection of companies that can throw off large amounts of cash across multiple industries, even in a market increasingly obsessed with artificial intelligence and faster growth stories.
That breadth also helps explain why Berkshire’s first quarter under Abel looked steadier than the broader market mood. The company again reminded investors that swings in reported investment gains and losses can make net income figures misleading from quarter to quarter. Berkshire’s own preferred measure, operating earnings, remains the cleaner test. On that score, the quarter was solid, but it also underscored the central question now facing Abel: what to do with the money.
Based on Berkshire’s balance sheet, the company ended March with roughly $397 billion of cash, cash equivalents and Treasury bills across the group. That is an extraordinary reserve even by Berkshire standards, and it is both a strength and a burden. It gives Abel flexibility if valuations crack or if a large acquisition becomes available. But it also highlights how hard it has become for Berkshire to move the needle. When a company is this large, even a multibillion-dollar deal may not materially change the earnings profile. Reuters also reported that Berkshire repurchased just $234 million of its own stock in the quarter, its first buyback since May 2024, a sign that management remains selective rather than eager to force capital back into the market.
That selectivity may be sensible, but it comes with a cost. Reuters noted ahead of the annual meeting that Berkshire had lagged the S&P 500 by 39 percentage points since Buffett announced at last year’s meeting that he would step down as chief executive. Some of that gap reflects the market’s renewed appetite for technology and AI-linked companies. Some reflects the simple math that giant diversified conglomerates rarely look exciting in momentum-driven markets. But some of it is also about perception. Buffett long made patience itself look like a competitive advantage. Abel has to prove that patience can still command investor trust when it comes from a manager best known for operations and disciplined execution rather than stock-picking mythology.
That is why Berkshire’s transition will likely be judged less by whether Abel sounds like Buffett and more by whether he allocates capital with similar restraint while keeping the operating businesses moving. He is inheriting a company with durable assets, real earnings power and unusual balance-sheet flexibility. He is also inheriting unresolved challenges. At the annual meeting, Abel said a recent Oregon appeals court decision had eased some pressure in PacifiCorp’s wildfire litigation, but the episode remains a reminder that Berkshire’s risks are increasingly embedded in the businesses it owns, not just in the securities it buys.
For investors, that may be the clearest lesson from Berkshire’s first post-Buffett quarter. The company does not need reinvention to remain formidable. It does, however, need the next era of leadership to turn size, liquidity and operational consistency into a compelling reason to own the stock in a market that prizes speed and narrative. Abel’s first quarter did not answer every question. It did show that Berkshire still has the raw materials to make the case, provided discipline remains its defining asset.