In the 2022 annual letter to shareholders, Warren Buffett described Berkshire Hathaway’s original textile business as “on a death march,” calling it the worst investment he ever made.
That failing New England mill, which Buffett took control of in 1965 at age 34, now anchors a conglomerate valued at $1.09 trillion, Stock Analysis confirmed.
On Sept. 18, 2026, the 96-year-old told shareholders he was stepping down as chairman effective immediately and would become chairman emeritus, with his son Howard replacing him as chairman and Greg Abel continuing as CEO.
“Father Time always wins,” Buffett wrote in a farewell letter to shareholders. “He has, however, been generous with me.”
Berkshire’s board had previously indicated Buffett planned to keep the chairman’s title. The timing caught investors off guard, even though the succession framework has been in place for years, Reuters reported.
How the Berkshire succession plan splits leadership in two
The handoff follows a framework Buffett outlined publicly more than a decade ago. He said he wanted Howard to serve as a non-executive chairman with no operating authority, as reported by ABC News in 2011.
Susan Decker, former Yahoo president and a longtime Berkshire director, will continue as lead independent director, Axios reported.
Abel handles capital allocation, acquisitions, and day-to-day management across segments from Geico’s insurance underwriting to BNSF’s freight rail network. Howard’s mandate is to preserve the principles Buffett embedded in the company’s culture.
Brian Jacobsen, chief economic strategist at Annex Wealth Management, told Al Jazeera that the transition reflected years of deliberate preparation.
<strong>Berkshire has had years to prepare for this transition, so this feels more like the completion of a carefully planned succession than a sudden changing of the guard</strong>.
Buffett reinforced that confidence in his letter to shareholders, writing that his expectations for Abel had been “sky high” and exceeded. Buffett will remain on the board, continuing to advise on major decisions.
He described Howard’s position as “a policy the shareholders own and hope never to claim against.” The scale of what both men now inherit traces back to one of the most unlikely turnarounds in American business.
From a struggling textile mill to a trillion-dollar Berkshire conglomerate
Buffett took control of Berkshire in 1965, when it was a declining New England textile operation. The decision, he told CNBC in 2010, cost him roughly $200 billion in foregone gains by routing capital through a textile shell instead of a clean insurance vehicle.
He spent 20 years trying to keep the mill alive before closing it in 1985 and redirecting its capital toward insurance, railroads, and consumer brands, the company’s 1985 shareholders’ letter confirmed.
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The pivot came in 1967, when Buffett acquired National Indemnity, an insurer whose cash flow provided him with capital to diversify, the Warren Buffett’s 2014 special letter stated.
From 1965 through 2025, Berkshire’s stock compounded at 19.7% annually, nearly doubling the S&P 500’s return over the same period, Berkshire’s 2025 Annual report showed.
The conglomerate now employs nearly 400,000 people across businesses that include Dairy Queen, Duracell, and Fruit of the Loom. It generated $44.5 billion in operating earnings last year, the 2025 report confirmed.
Berkshire’s second-quarter results showed that revenue reached $101.81 billion, a 10.1% increase from the prior year, according to the company’s second-quarter Form 10-Q.
Operating profit climbed 16% to $12.98 billion, as shown in the company’s Aug. 8, 2026, earnings release.
Where Berkshire’s stock stands as the post-Buffett era takes shape
Berkshire’s share price barely moved on the announcement as the stock has gained about 1% in 2026, while the S&P 500 has rallied more than 11%, CNBC reported.
The underlying business closed the second quarter with $365.5 billion in cash and short-term Treasury bills, down from a record $397.4 billion three months earlier, as Berkshire deployed capital into buybacks and equity purchases, the company’s Q2 Form 10-Q showed.
Abel began drawing down that reserve in the second quarter, according to the company’s Form 10-Q, spending about $4.5 billion on buybacks.
Berkshire also became a net buyer of equities in the period, accumulating nearly $20 billion in net purchases after 14 straight quarters of net selling, CNBC reported.
The company’s price-to-book ratio has slipped from about 1.62 to 1.53 since Buffett first announced his CEO departure, based on London Stock Exchange Group data cited by Reuters.
That decline reflects investors still pricing Berkshire without the figure most identified with its strategy.
“You had a company led by a famed value investor, and now you don’t,” said Cathy Seifert, a senior vice president and director at CFRA Research, Reuters reported. The remark captures how investors are repricing Berkshire for the leadership change.
The open question Berkshire shareholders still face
Jacobsen’s description of the exit as “graceful” aligns with the early market verdict: no panic selling and no rush for the exits, Al Jazeera reported.
Abel’s second-quarter moves, from sharply accelerating share repurchases that resumed in the first quarter to expanding Berkshire’s position in Alphabet, offer early data on his instincts. Seifert’s assessment points to the variable that will take longer to resolve.
Whether Berkshire can keep performing with one leader running the business and another protecting its culture is something only years of results will show.
Related: Warren Buffett hands son Howard Berkshire’s strangest job
