Berkshire Hathaway Q1 Preview: All Eyes on Succession, Cash Strategy, and Global Positioning

As Berkshire Hathaway prepares to report its first-quarter results on Saturday, May 3, investors are less concerned with EPS beats and more focused on the macro themes that define the conglomerate’s identity: Warren Buffett’s stewardship of a $330+ billion cash pile, the evolving succession narrative, and where the Oracle of Omaha sees value amid geopolitical volatility and tariff uncertainty. After a blockbuster 2024 driven by insurance gains and investment income, the 2025 narrative hinges on whether Berkshire can sustain that momentum and whether Buffett—turning 95 this summer—is preparing the next generation for the inevitable handoff.

Watch: CFRA's Cathy Seifert highlights the key topics to watch from Berkshire's earnings announcement.

Investor Focus: Capital Allocation, Succession, and Strategic Posture

According to Cathy Seifert, SVP at CFRA Research, this weekend’s meeting and report will serve as a de facto “State of the Union” for Berkshire investors. Key questions include how Buffett intends to navigate tariff-induced uncertainty, whether more overseas capital deployment is in the cards, and who ultimately leads in the post-Buffett era. Succession talk is intensifying, particularly as Berkshire shortened this year’s meeting schedule and Buffett’s public appearances have grown more measured. While Greg Abel and Ajit Jain are regarded as capable, “there is an element to Warren Buffett that is irreplaceable,” Seifert notes.

Capital allocation remains front and center. Berkshire’s record $334 billion in cash has been parked largely in short-term Treasuries, a move that once drew skepticism but now looks prescient. Buffett has eschewed long-dated bonds, and some see echoes of a 1970s playbook: defensive stock picks, cash-rich positioning, and minimal equity risk exposure until better prices emerge. Investors will look for signs of deployment—either through equity buys, acquisitions, or stock repurchases.

Portfolio Moves: Apple Trimming, Japanese Expansion, and Defensive Tilts

The portfolio composition always attracts attention, especially after Berkshire trimmed its Apple (AAPL) stake by nearly two-thirds in 2024 and offloaded a significant chunk of Bank of America (BAC). The focus now shifts to where that cash is going. Notable additions last year included Constellation Brands (STZ), Domino’s Pizza (DPZ), and Five Japanese trading houses—moves that emphasize overseas diversification and recession-resistant cash flow.

While Buffett’s exposure to energy through Occidental Petroleum (OXY) and Chevron (CVX) remains north of 10% of the portfolio, there’s growing anticipation around further non-U.S. investments. The Japanese plays have performed well, and some analysts expect additional capital to follow. Investors will also be watching closely to see if Berkshire has resumed accumulating shares of companies like OXY or expanded into new geographies.

Insurance: Still the Engine of Profitability

Q1 will test whether the 2024 surge in insurance earnings—driven largely by Geico—has staying power. Underwriting profit at Geico soared to $7.8 billion in 2024, with a 19% margin that vastly exceeded historical norms. While Q1 estimates suggest a slight moderation, the market will want to see signs that the business remains structurally improved under CEO Todd Combs. Berkshire's Q4 insurance investment income was $4.1 billion, up nearly 50% YoY, bolstered by higher rates on Treasury holdings.

Seifert points out that this insurance momentum is vital as it allows Berkshire to compound float and underwrite risk cheaply in an uncertain macro climate. Still, questions remain about how sustainable these underwriting margins are, particularly as the U.S. faces renewed economic pressure from inflation and tariffs.

Energy and Rail: Solid but Uneven

Berkshire Hathaway Energy continues to post strong results, with profit rising 65% YoY in 2024 to $3.7 billion. A leader in wind power, BHE also benefits heavily from federal renewable energy tax credits—receiving around $2 billion annually. Investors will expect continued strength here, especially as clean energy capex becomes politically and economically important.

BNSF Railway, on the other hand, has underperformed rival Union Pacific. Profits fell 5% in Q4 and declined about 1% for the full year. Given Berkshire’s long-term view, short-term fluctuations at BNSF aren’t alarming, but the gap in profitability with peers may begin to raise questions about operating efficiency or capital investment strategy.

OXY: Investment or Acquisition?

Buffett’s 40% economic interest in Occidental Petroleum, including warrants, has spurred persistent speculation that Berkshire might fully acquire the company. While no official move has been made, analysts will be parsing the Q1 commentary for clues. OXY fits Buffett’s criteria: strong cash flow, essential industry, and capital discipline. Any commentary on OXY’s operational performance or Berkshire’s intentions could shift sentiment quickly.

What the Oracle Says Still Matters

At the end of the day, the most anticipated part of the weekend will be Buffett’s remarks. As Seifert puts it, “Even the billionaire bashers don’t bash Warren Buffett.” Investors, both retail and institutional, are looking for guidance not just on Berkshire, but on the broader market, the U.S. economy, and the global trade environment.

In a time of inflation fears, tariff threats, and geopolitical disorder, Buffett’s long-view compass remains a powerful psychological anchor. His emphasis on fundamentals—price paid, earnings power, and capital allocation—has helped generations of investors navigate uncertainty. Even if his voice is slightly quieter this year, the market will be listening closely.