Berkshire Meeting Highlights Tough Balancing Act for Greg Abel
(Bloomberg) — It didn’t take long for Greg Abel to address the elephant in the room.
Berkshire Hathaway Inc. on Saturday. In his first few minutes addressing shareholders — the first annual meeting where Warren Buffett isn’t leading the celebrations — Abel took investors back a year to when Buffett shocked the room and installed himself as the next chief executive.
Abel, known as a shrewd operator always looking for ways to increase profits across the $1 trillion conglomerate’s various business lines, said he had only one thought in mind at the time: The company had already spent the money to book the arena for the annual meeting in 2026. Would they need it since he was the only draw?
Apparently they did this. Although the crowd was smaller, thousands of investors flocked to Omaha, Nebraska, to hear from the 63-year-old new CEO.
Long known as the Woodstock of Capitalists, the event still had its usual quirky features: On Friday, shareholders milled around the exhibit hall floor, grabbed Squishmallows from Buffett’s former business partner Charlie Munger, and posed for photos with Geico’s gecko mascot. Investors can also purchase a “Carrying Card Capitalist” card for $2, with benefits provided to the nonprofit Girls Inc.
But there were some noticeable departures from tradition: Abel shared the spotlight with his top commanders, giving them the chance to speak directly to investors about their different businesses.
The meeting carried “The Legacy Continues” branding, apparently a move intended to reassure longtime investors that the storied conglomerate can continue to thrive without Buffett as CEO.
Abel has the firm support of Buffett and the Berkshire board. Still, the company’s Class B shares have lost 12.4% since Abel was named CEO. And the company needs to figure out how to use its nearly $400 billion cash pile.
That said, there’s no point in trying to follow Buffett as the host of the annual meeting. Buffett’s candid wisdom and cheerful remarks were traditionally much of the upbeat atmosphere of the meeting.
Announcements from Buffett and Munger
The new CEO honored his legendary predecessors with a few lighthearted moments at the beginning of the meeting. It started with a video featuring highlights from Buffett’s long CEO career and the theme song to the movie “Back to the Future.”
Two jerseys were hung above the main stage, displaying Buffett and Munger’s names and their tenures at Berkshire (60 and 45 years, respectively). A can of Cherry Coke, Buffett’s favorite drink, was placed on the table next to Abel’s notes.
After that, Abel got down to business, providing a simple and comprehensive update on Berkshire’s various companies and stock holdings. Later, he answered shareholders’ questions along with Vice Chairman Ajit Jain.
“He gave us a lot of detail about the business, he touched on a lot of different businesses, he showed that he understands them, he understands the risks, he understands the opportunities,” said Adam Mead, CEO and Chief Investment Officer of Mead Capital Management, who attended the meeting. “He has done his homework and is absolutely the leader Warren told us he would be.”
Abel, who had never managed money professionally until becoming CEO this year, gave shareholders a glimpse into his investment perspective. Berkshire has identified several firms with interesting management and operations, but is not interested in buying or investing in them because of their high valuations, Abel said.
Although the Buffett-Munger duo’s legendary comedic chemistry was missing, Abel and Jain still earned some applause and a few laughs from the audience.
“There was a very healthy dynamic between Greg and Ajit,” Mead said. “It almost felt like there really was a little bit of a Warren and Charlie type dynamic. I thought it was great.”
One of Jain’s answers led Abel to compare himself to Munger, who died in 2023. Asked whether Berkshire would consider offering insurance to ships passing through the Strait of Hormuz, the critical shipping channel for oil that has been essentially closed since the beginning of the war with Iran, Jain said: “The short answer is: it depends on the price.”
“I liked Charlie’s answer,” Abel said.
Although Berkshire Chairman Buffett was not on the main stage, he still spoke at the meeting, delivering a short speech to shareholders from his seat among Berkshire executives focusing on corporate leadership and, more specifically, successful transitions of power.
Using Apple Inc. as an example, Buffett reminded the crowd that almost no one knew who could successfully run the iPhone maker after Steve Jobs’ death, and few investors at the time knew who Tim Cook was. Buffett, who invested $35 billion in Apple a decade ago, or about 10% of Berkshire’s resources, said that bet has since turned into $185 billion, including dividends, and he thanked Tim for that.
The first shareholder question came from “Warren from Omaha” Buffett in the AI deepfake. Abel touched on technology more broadly in his speech, noting that Berkshire could benefit from growth because it has services that power data centers.
Christopher Davis, a shareholder at Hudson Value Partners, said he was pleased that Abel laid out how Berkshire is approaching artificial intelligence.
“Hearing that Berkshire operating businesses are embracing the mindset of not just buyers but also technology developers — coders and engineers are on staff — confirms that Greg Abel is bringing Berkshire operations into the modern age of AI,” he said.
–With help from Jenny Surane.
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