Berkshire Hathaway released its first earnings report under new CEO Greg Abel on May 2, 2026 (Beijing time), marking the company's financial performance in the post-Warren Buffett era. Abel assumed the CEO position on January 1, 2026. The company reported first-quarter net profit of $10.11 billion, up approximately 120% from $4.603 billion in the same period last year, with operating profit reaching $11.35 billion, up 18% year-over-year.
Net Profit Growth and Investment Gains
The substantial net profit increase was driven primarily by investment gains. In the first quarter of 2026, Berkshire realized after-tax gains of $5.8 billion from investment sales, more than double the $2.4 billion recorded in Q1 2025. These realized gains offset investment losses, which narrowed from $5.038 billion to $1.240 billion, contributing to the approximately 120% year-over-year growth in GAAP net profit.
However, the company reiterated its standard disclaimer regarding GAAP accounting requirements: "The amount of investment gains or losses realized in any particular quarter is usually meaningless and can be very misleading to investors who do not understand accounting rules."
Operating Profit and Business Segment Performance
Operating profit, which excludes short-term portfolio fluctuations and is viewed by Buffett as a more reliable measure of true operating performance, reached $11.346 billion in Q1 2026, compared to $9.641 billion in the same period last year.
Across operating segments, performance was mixed:
- Insurance underwriting showed the strongest growth, with profits of $1.717 billion, up 28.5% from $1.336 billion in Q1 2025
- BNSF railroad generated after-tax profit of $1.377 billion, up 13% from $1.214 billion
- Manufacturing, Service & Retail segment profit rose 5% to $3.199 billion
- Berkshire Hathaway Energy (BHE) saw modest growth from $1.097 billion to $1.114 billion
- Insurance investment income was the only segment to decline, falling 7% from $2.893 billion to $2.679 billion
Stock Portfolio Concentration
Berkshire maintained its "concentrated investment" philosophy, with no fundamental changes to its core holdings. As of Q1 2026, approximately 61% of the company's total stock investment fair value remained concentrated in its "Big Five" holdings: American Express, Apple, Bank of America, Chevron, and Coca-Cola.
Record Cash Reserves and Acquisition Strategy
Berkshire's cash and cash equivalents surged to a record $397.38 billion as of March 31, 2026, marking a new all-time high. During the shareholder meeting held on the earnings announcement date, CEO Abel stated that Berkshire has identified some outstanding companies for potential evaluation. However, he noted that "given current valuations of these companies, combined with economic prospects and risks, we don't have enough interest to acquire yet and need more time to prepare."
