Warren Buffett’s Berkshire is lagging the S&P 500 by the largest gap so far this year
(This is the Warren Buffett Watch newsletter, news and analysis, covering all things Warren Buffett and Berkshire Hathaway. You can sign up Here To get it in your inbox every Friday evening.)
Berkshire Hathaway B shares It has recovered 7.2% since its short-term closing low of $459.11 on August 4.
At that point they were down almost 15% following Warren Buffett. Surprise announcement at the beginning of May He said he would step down as CEO at the end of the year.
This gives BRKB a YTD gain of 8.6%. ( A shares increased by 8.5%
Berkshire has nearly $50 billion in ‘lost’ profits as Apple wins
AppleThe index, which constitutes 6.35% of the S&P index, closed today at a record level.
At $262.82 per share, it’s up more than 50% since Berkshire began selling shares in the fourth quarter of 2023.
Berkshire has since reduced its holdings from almost 916 million shares as of September 30, 2023, to 280 million shares as of June 30.
That’s a 69% decline, even though stocks remain the portfolio’s largest asset.
There may be more sales (or possibly some buying) in the third quarter of this year. We will receive the new share count from Berkshire in mid-November.
So far the decision to sell doesn’t look good.
If Berkshire had held on to all its shares, the stock would be worth $241 billion today instead of its current $74 billion (assuming no movement in the third quarter), a difference of $167 billion.
Barron’s predictions Berkshire’s average sales price was around $185 per share, giving it a pre-tax gain of about $96 billion, leaving roughly $50 billion “on the table.”
And Berkshire’s profits were reduced by about $20 billion in taxes. Barron’s calculations.
Buffett didn’t say much about why he sharply reduced Apple shares.
His only public statement came out of nowhere Response to shareholders’ question at last year’s annual meeting.
Buffett stated that he expects Apple to remain Berkshire’s largest stock position in the future and that Apple is a much better business than American Express and Apple, which he has owned for a long time. Coca Cola.
But he also predicts capital gains tax rates will rise, so he figured shareholders wouldn’t mind paying a lower rate for what he later called a “small” Apple sale, rather than a higher rate.
At the time, Berkshire had reduced its holdings by only about 14%.
A video clip and transcript are included in the “Highlights from the Archive” section below.
Jazwares joins forces
Berkshire Hathaway Jazwaresknown for “squishmallows,“This week it announced two partnerships.
“will be”Official worldwide plush Licensee“Next year’s FIFA World Cup.
The product line, which includes the “highly anticipated official mascot” of the football (US)/soccer (UK) tournament, will be released next June.
BUFFET ON THE INTERNET
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HIGHLIGHTS FROM THE ARCHIVE
Buffett: Possibility of higher tax rates in the future makes selling Apple shares more attractive now (2024)
Warren Buffett says He expects the capital gains tax rate to rise further in the future as the U.S. struggles with its budget deficit. While Berkshire generally doesn’t shy away from paying taxes, shareholders may appreciate that some Apple shares were sold at the current 21% rate before the tax burden got even deeper.
BECKY FAST: “Have your or your investment managers’ views on the economics of Apple’s business or its attractiveness as an investment changed since Berkshire first invested in 2016?”
WARREN BUFFET: No, I would, but we sold our shares. And I would say, I think it’s extremely likely that by the end of the year Apple will be the largest stock we’ve ever owned.
Now… here’s something that might surprise you, but we – almost everyone I know is much more careful about not paying taxes than I thought.
We don’t mind paying taxes in Berkshire. And we pay a 21% federal rate on our earnings from Apple.
And not so long ago, this rate was 35 percent, and in the past when I was working, it was 52 percent.
The federal government owns a portion of the profits of what we do. They don’t own the assets but they do own a percentage of the earnings.
And they can change this percentage any year they want. And the rate they’ve settled on now is 21 percent.
And I would say that I think something needs to happen with the current fiscal policies. And I think higher taxes are quite likely.
And if the government wants to take a larger share of your income, or mine, or Berkshire’s, they can.
And one day they may decide that they don’t want the fiscal deficit to be that big, because that has some significant consequences, and they might not want to cut spending too much. And they may decide to take a larger percentage of what we earn. And we will pay for it.
And we always expect to pay significant federal income taxes in Berkshire. A country and a company that is so generous to its owners…
Writing that check doesn’t bother me at all.
And with all that America has done for all of you, I really hope you don’t mind that we did this.
And if I’m doing it at 21 percent this year, and we’re going to do it at a much higher percentage later, I don’t think you’ll actually mind if we sold some Apple this year.
BERKSHire SHARE TIME
BERKSHire’S LARGEST SHAREHOLDING HOLDINGS – October 24, 2025
Berkshire’s largest listed publicly traded stocks by market capitalization in the U.S., Japan and Hong Kong at today’s closing prices.
Holdings as of June 30, 2025, as reported. Berkshire Hathaway’s 13F application On August 14, 2025, except:
A complete list of holdings and current market values is available on CNBC.com’s Berkshire Hathaway Portfolio Tracker.
pct due to a spreadsheet formula error. A percentage of the portfolio figures were off for an embarrassingly large number of weeks. The problem is now solved.
QUESTIONS OR COMMENTS
Please send me any questions or comments about the newsletter at: alex.crippen@nbcuni.com. (We’re sorry, but we do not forward questions or comments to Buffett himself.)
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Additionally, reading Buffett’s annual letters to shareholders is highly recommended. There are people gathered on Berkshire’s website here.
— Alex Crippen, Editor, Warren Buffett Watch
