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Berkshire Hathaway-B shares fall 2.4% in US premarket
ByAinvest
Monday, May 5, 2025 4:12 am ET1min read
Berkshire Hathaway-B shares fall 2.4% in US premarket after Buffett announces plan to step down as CEO by end-2025.
Berkshire Hathaway Inc.'s (BRK.A, BRK.B) B shares fell by 2.4% in US premarket trading on May 5, 2025, following the announcement that Warren Buffett plans to step down as CEO by the end of 2025. The news was met with a significant sell-off, indicating investor concerns about the company's future leadership and strategic direction.Buffett's decision to retire as CEO, effective at the end of 2025, has been widely anticipated but has not been officially confirmed until now. The 95-year-old Buffett has been a key figure in Berkshire Hathaway's success, and his departure will mark a significant change in the company's leadership.
The market reaction underscores the uncertainty surrounding Berkshire Hathaway's future. The company's financial performance in the first quarter of 2025 was mixed, with revenue remaining essentially flat at $89.725 billion compared to $89.869 billion in the same period last year. However, net profit fell sharply by 64% to $4.603 billion, mainly due to a decrease in investment income [1].
Insurance underwriting income was $1.34 billion, nearly halved due to the impact of wildfires in Southern California. Net losses from stock investments amounted to $5.038 billion, while cash reserves reached $34.77 billion, a record high, and no stock buybacks were conducted [1].
The drop in B shares is also a reflection of broader market sentiment and concerns about the broader economic environment. The pace of macroeconomic and geopolitical events is expected to accelerate, including changes in international trade policies and tariffs, which may impact Berkshire Hathaway's operations [1].
Despite the recent decline, Berkshire Hathaway remains a diversified conglomerate with interests in insurance, railroad freight, utilities, manufacturing, and retail. The company's long-term prospects will depend on the success of its new leadership and its ability to navigate the evolving business landscape.
References:
[1] https://longportapp.com/en/news/238659487
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