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November 8, 2026

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Business & Money

Berkshire Hathaway’s Profits Fall as Insurance Weakens — But Its $377 Billion Cash Pile Keeps Growing

Faizan Altaf

Berkshire Hathaway, one of the biggest and most closely watched companies in the world, has reported weaker profits for the third quarter of 2026. The company, based in Omaha, Nebraska, said its operating earnings fell by almost 6% compared with the same period last year, while its overall net profit dropped by 28%.

The results, released on Saturday, 7 November 2026, give the clearest picture yet of how Berkshire is performing in its first year under a new chief executive, Greg Abel. They also show a company that is sitting on an enormous pile of cash — $377.4 billion — while buying back its own shares at the fastest pace this year.

For ordinary readers, the numbers can look confusing. Berkshire’s profits move up and down sharply because of the value of the shares it owns, even when it has not sold them. This article explains what the results actually say, why profits fell, what the company is doing with its cash, and what to watch next.

The headline numbers

Berkshire reported net earnings of $22.1 billion for the three months to the end of September 2026. That is down from $30.8 billion in the same quarter of 2025 — a fall of about 28%.

But net earnings are not the number that most serious watchers of Berkshire focus on. The company itself warns that the figure can be misleading, because it includes gains and losses on shares the company still owns and has no plans to sell. When the stock market rises, those paper gains push net earnings up. When it falls, they drag them down — even if nothing has changed in the underlying businesses.

The more useful measure is operating earnings. This counts the profits from the businesses Berkshire actually owns and runs — its insurance companies, its railway, its energy firms, its shops and factories — plus the dividends and interest from its investments. It leaves out the ups and downs of share prices.

On that measure, Berkshire earned $12.7 billion in the third quarter, down from $13.5 billion a year earlier. That is a fall of 5.8%.

Over the first nine months of 2026, the picture looks better. Net earnings for the nine months were $57.9 billion, up from $47.8 billion in the same period of 2025. Operating earnings for the nine months were $37.0 billion, up from $34.3 billion.

Earnings per Class A share — Berkshire’s famously expensive top-tier shares — were $15,502 for the quarter, down from $21,413 a year earlier. Earnings per Class B share were $10.33, down from $14.28.

Why profits fell

Two things dragged the quarterly results down: weaker insurance profits and smaller gains on investments.

Insurance had a tough quarter

Insurance is the heart of Berkshire Hathaway. The company owns several large insurers, including Geico, the car insurer, and a giant reinsurance business that insures other insurance companies. These businesses collect premiums from customers and invest the money — known as the “float” — until claims have to be paid. At the end of September, that float stood at about $178.5 billion.

In the third quarter, income from insurance underwriting — the basic business of taking in premiums and paying out claims — fell sharply. It dropped to $1.35 billion from $2.37 billion a year earlier, a fall of 43%.

According to Bloomberg, the main problem was at Geico. Losses from claims rose by 8.5%, and the cost of running the underwriting business jumped by 17%. At the same time, the income Berkshire earns from investing its insurance money fell by 14% to $2.7 billion, largely because short-term interest rates are lower than they were.

In plain terms: more money went out in claims and costs, and less money came in from investments. That combination squeezed insurance profits.

Investment gains were smaller

The second reason for the fall in net earnings is simpler: the shares Berkshire owns did not rise as much this quarter as they did a year ago.

Berkshire holds large stakes in some of America’s best-known companies, including Apple, American Express, Coca-Cola and Moody’s. In the third quarter of 2026, gains on those investments were $9.4 billion, compared with $17.3 billion in the same quarter of 2025.

That $7.9 billion gap explains most of the drop in net earnings. It does not mean Berkshire sold shares at a loss. It means the shares it holds were worth less at the end of September than the gains recorded a year earlier — a paper change, not a cash one.

This is exactly why Berkshire’s own press release carries a warning in bold type: the amount of investment gains or losses in any single quarter “is usually meaningless” and can give a misleading picture of how the company is really doing.

The buybacks are back

One of the most striking parts of the results is how much money Berkshire spent buying its own shares.

The company bought back about $9.6 billion of its own stock in the third quarter — the most in any quarter so far this year. That takes total buybacks for the first nine months of 2026 to about $14.4 billion.

That is a big change from recent years. Under Warren Buffett, Berkshire went through a long stretch without buying back any shares at all — five straight quarters with no buybacks in the period leading up to late 2025. The company instead let its cash pile grow.

The return of buybacks is one of the clearest signs of the new chief executive’s approach. Greg Abel, who took over as chief executive on 1 January 2026, has shown he is willing to spend the company’s money when he thinks the shares are good value. In the first half of the year, Berkshire spent about $4.8 billion on buybacks. The third quarter alone was double that.

When a company buys back its own shares, it reduces the number of shares in circulation. Each remaining share then represents a slightly bigger slice of the company. It is a way of returning money to shareholders without paying a dividend — and Berkshire has never paid a dividend.

The $377 billion question

Even after spending billions on buybacks and new investments, Berkshire still had $377.4 billion in cash and short-term investments at the end of September. That is up slightly from the end of 2025.

The size of this cash pile is one of the most talked-about numbers in the investing world. It is larger than the entire value of most companies on the stock market. And it raises an obvious question: why does Berkshire keep so much money sitting in cash instead of investing it?

There are a few answers. First, Berkshire needs a large cushion because of its insurance businesses. If a major disaster struck — a huge hurricane, for example — it might have to pay out billions in claims very quickly. The cash is there to make sure it always can.

Second, Berkshire likes to be ready. When markets fall or a good business comes up for sale, the company wants to be able to move fast with cash in hand, rather than having to borrow money or sell shares at a bad time.

Third, Abel and his team are picky. Berkshire only buys businesses or shares when it thinks the price is right. If it cannot find good value, it would rather wait — even if that means the cash keeps growing.

Still, the cash pile has been shrinking from its peak as Abel puts money to work. In July, Berkshire closed its purchase of homebuilder Taylor Morrison for around $6.8 billion. And in June, it agreed to invest $10 billion in Alphabet, the parent company of Google, to support its work on artificial intelligence. It also put $930 million into Bending Spoons, an Italian technology company.

Investors will get a fuller picture of what Berkshire has been buying and selling when it files its detailed list of stock holdings, which is due by 16 November 2026.

Greg Abel’s first year

This is the first full year of Berkshire Hathaway without Warren Buffett as chief executive. Buffett, who took control of the company in 1965 and built it from a struggling textile mill into a giant worth hundreds of billions of dollars, handed the chief executive job to Abel on 1 January 2026. It was the first change of chief executive in more than 60 years.

Buffett remains on the board, but the day-to-day running of the company is now Abel’s. Abel, a Canadian-born accountant, worked at Berkshire for more than 25 years before taking the top job, most recently running its non-insurance businesses.

His first year has been a mix of continuity and change. The company still follows Buffett’s basic approach: buy good businesses, hold them for a long time, and do not overpay. But Abel has moved faster in some areas. He has revived share buybacks, made Berkshire’s first big bets on artificial intelligence, and reshaped parts of the stock portfolio — selling out of 16 positions entirely in his first quarter as chief executive, according to filings.

The market, so far, has not punished the change. Berkshire’s Class B shares closed at $579.09 on 4 November, a new record high, just days before these results were released.

What the numbers do — and do not — tell you

Berkshire Hathaway is unusual, and its results are easy to misread. Here is a simple guide to the three numbers that matter most.

Net earnings is the headline profit figure, but it includes paper gains and losses on shares Berkshire still owns. It can swing by billions of dollars from one quarter to the next even when nothing has changed in the real businesses. A big fall in net earnings does not mean the company is in trouble.

Operating earnings is the better guide to how the businesses are actually doing. It counts the profits from insurance, the railway, energy, shops and factories, plus dividends and interest. When this number falls, as it did by 5.8% this quarter, it means the underlying businesses earned less — in this case, mainly because insurance had a weak quarter.

Cash and investments show how much firepower Berkshire has. The $377.4 billion pile means the company can survive almost any shock and can afford to buy almost any business it wants. The question investors keep asking is when — and on what — Abel will spend it.

What to watch next

Three things will tell us more about where Berkshire is heading.

First, the detailed filing of Berkshire’s stock holdings, due by 16 November, will show whether Abel bought or sold shares in the third quarter, and whether the Alphabet bet grew or shrank.

Second, the annual report early next year will include Abel’s second letter to shareholders. His first letter, released in February 2026, named Apple, American Express, Coca-Cola and Moody’s as the company’s core long-term holdings. Investors will be watching for any change in that list.

Third, the insurance business will be under the spotlight. If Geico’s costs keep rising and investment income keeps falling, operating earnings could stay under pressure. If claims settle down, the insurance engine that has powered Berkshire for decades should recover.

For now, the message of these results is a balanced one. Berkshire’s businesses earned less this quarter than they did a year ago, but they still earned $12.7 billion. Its share portfolio gained less, but it still gained $9.4 billion. And its cash pile remains one of the largest ever held by any company in the world.

Frequently asked questions

What is Berkshire Hathaway?

Berkshire Hathaway is a holding company based in Omaha, Nebraska. It owns dozens of businesses outright — including the insurer Geico, the BNSF railway, energy companies and many smaller firms — and holds large stakes in public companies such as Apple, American Express, Coca-Cola and Moody’s.

Why did Berkshire’s profits fall?

Operating earnings fell 5.8% because insurance profits dropped sharply, with Geico facing higher claims and costs, and investment income fell as interest rates declined. Net earnings fell further, by 28%, because gains on the shares Berkshire owns were much smaller than a year earlier.

How much cash does Berkshire Hathaway have?

Berkshire had $377.4 billion in cash, cash equivalents and short-term investments at 30 September 2026, up slightly from the end of 2025.

Who runs Berkshire Hathaway now?

Greg Abel became chief executive on 1 January 2026, succeeding Warren Buffett, who had run the company since 1965. Buffett remains on the board.

What is a share buyback?

A share buyback is when a company uses its own money to buy its shares back from investors. It reduces the number of shares in circulation, so each remaining share represents a bigger slice of the company. Berkshire spent $9.6 billion on buybacks in the third quarter of 2026.

Why does Berkshire not pay a dividend?

Berkshire has never paid a dividend. Instead of handing cash to shareholders, it reinvests the money in its businesses, buys other companies, or buys back its own shares. Buffett long argued that the company could earn a better return on the money than shareholders could on their own.

Conclusion

Berkshire Hathaway’s third-quarter results are a reminder that even the world’s most admired company has weak quarters. Insurance, the engine that has powered Berkshire for decades, stumbled. Investment gains shrank. And yet the company still made $12.7 billion from its businesses, still holds $377.4 billion in cash, and is now buying back its own shares at the fastest pace in years.

The real story of these results is not the fall in profits. It is what Greg Abel is doing with the company he inherited: spending the cash, reviving buybacks, and making new bets on housing and artificial intelligence. Whether those bets pay off will shape Berkshire’s next decade — and this quarter’s numbers are only the first chapter.

Sources

This article is for general information and education only. It is not legal or financial advice.

Faizan Altaf

Faizan Altaf is the founder and author of findivoza.com, a news blog covering world, Pakistan, business, technology, health and sport in plain English. He writes for general readers who want clear, trustworthy news without jargon. His work focuses on explaining what happened, why it matters, and what to watch next.

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