Berkshire CEO Greg Abel vows to keep Buffett’s culture of disciplined investing in first annual letter
Berkshire HathawayGreg Abel used his first annual shareholder letter as CEO to reassure investors that the conglomerate’s culture of financial conservatism and disciplined investing established under Warren Buffett will continue “in perpetuity.”
“I am honored by our board’s decision to appoint me as CEO of Berkshire and honored to succeed Warren in writing my first annual letter to you,” Abel wrote in his letter regarding the company’s new start. annual report It was released along with Berkshire’s quarterly earnings on Saturday. “Warren is certainly a very difficult act to follow.”
Abel, 63, signaled continuity rather than change as he took the reins from Buffett, 95, who steps down as CEO at the beginning of 2026 and remains chairman. The new CEO laid out a clear core values framework for how he plans to run the conglomerate: preserving its financial strength and maintaining strict capital discipline.
“We maintain a fortress-like balance sheet to ensure Berkshire’s foundation is never compromised,” he wrote. “We maintain this financial strength by using our debts economically and prudently. Our high liquidity allows us to fulfill our obligations even under the most adverse conditions and to react quickly when opportunities arise.”
Other values he emphasized included a decentralized management model and a “reputation for integrity.”
Berkshire’s cash pile was $373.3 billion at the end of 2025. Abel described the mountain of cash as strategic dry powder; This allows the company to act decisively when opportunities arise without compromising resilience. Abel also used the letter to push back on any notion that its large cash position meant Berkshire was pulling back from investing.
However, Abel stated that he would continue his long-standing resistance to Berkshire paying dividends.
“Our approach regarding cash dividends continues to be that Berkshire will not pay dividends unless there is a reasonable likelihood that each dollar of retained earnings will create more than one dollar of market value for shareholders,” Abel wrote, adding that the board reviews the policy annually.
Auditing the share portfolio
Abel emphasized that Berkshire applies the same disciplined framework whether buying an entire business, buying shares of a publicly traded company, or buying back its own shares.
“We will evaluate the value carefully, be patient, and stay that way for the long term, preferably indefinitely,” he wrote.
He added that Berkshire’s stock portfolio will continue to be concentrated in a small group of American companies. Apple, American Express, Coca Cola And Moody’sHe said Berkshire expects to compound over decades. Not specifically included in this list Bank of AmericaBy the end of 2025, it became Berkshire’s third largest holding.
Abel said the concentrated approach would continue with limited trading activity, but that Berkshire would “significantly adjust” its position if long-term economic expectations change.
It also resolved a key question regarding the leadership transition: He will directly oversee the stock portfolio. Ted Weschler will continue to manage about 6% of the portfolio, including investments previously overseen by Todd Combs, an investment manager and Geico CEO who recently left JPMorgan.
“At Berkshire, equity investments are the foundation of our capital allocation activities; the responsibility ultimately rests with me as CEO,” Abel wrote.
long term commitment
Abel is known internally as a hands-on operator, with numerous subsidiary CEOs reporting to him. The Canadian executive, born in Edmonton, Alberta, has a 25-year tenure at Berkshire. Abel joined Berkshire in 2000 after the conglomerate acquired MidAmerican Energy, eventually becoming CEO in 2008. Prior to this, Abel worked at CalEnergy, where he transformed a small geothermal firm into a diversified energy business.
He emphasized that he sees the role as a long-term commitment, as he plans to run Berkshire for decades.
“Our owners’ time horizon extends beyond the tenure of any CEO,” he wrote. “I won’t be your CEO for the next 60 years because simple arithmetic makes that an, shall we say, ambitious plan. But 20 years from now, I’ll only have a fraction of the tenure Warren has had, with the intention that you or your grandchildren will be proud that your company is even stronger.”
He noted that Buffett remains actively involved as chairman, coming into the office five days a week and continuing to contribute.
Abel also made clear that Berkshire will not adopt Wall Street’s typical cadence of quarterly earnings calls.
“We focus on quality, not frequency. You will hear from me if a significant issue arises, but given our long-term horizon it will not be through quarterly comments,” he wrote.
