Buffett's Cash Citadel Faces Stock Slide, Leadership Shift, and Gates Scrutiny

Berkshire Hathaway Inc. (BRK.A) has reported a record cash reserve of $381.67 billion as of September 30, 2025, according to its third-quarter earnings release. The Omaha-based conglomerate's cash pile surged from $347.7 billion in the first quarter of the year and marks a significant milestone in its long-term financial strategy. Operating earnings for the period reached $13.49 billion, a 33.6% year-over-year increase, driven by robust performance in its insurance underwriting segment, according to Seeking Alpha. Total revenue for the quarter stood at $94.97 billion, up 2.1% from the same period in 2024, the Seeking Alpha note said.

The growth in Berkshire's cash reserves reflects a combination of strong operating performance and disciplined capital allocation. Despite a sharp rebound in operating profit, the company continued its streak of net stock selling, liquidating positions for a 12th consecutive quarter to generate $10.4 billion in taxable gains, as reported by CNBC. This approach aligns with Warren Buffett's long-standing philosophy of prioritizing cash preservation and strategic reinvestment, though critics have questioned the lack of share buybacks amid a 5% decline in Berkshire's stock price year-to-date, the CNBC piece noted.

Berkshire's investment portfolio remains heavily concentrated, with its top five equity holdings—American Express, Apple, Bank of America, Coca-Cola, and Chevron—accounting for 66% of the total fair value of equity investments as of September 30, according to Lookonchain. The company also holds a 22% stake in American Express and a 27.5% position in Kraft Heinz, the Reuters release added. Notably, the Bill & Melinda Gates Foundation, a major institutional investor in Berkshire, has faced scrutiny over its financial operations. The foundation's $47.78 billion trust holds a $11.7 billion stake in Berkshire, representing 24.7% of its portfolio, according to a Benzinga report. The U.S. Senate is currently investigating the foundation for alleged violations of its tax-exempt status through grants to Chinese state-run entities, the report said.

Berkshire's leadership transition is another focal point as 95-year-old Buffett steps down as CEO at year-end, with Greg Abel set to assume the role, the company announced. The transition has already impacted stock performance, with shares down double digits from all-time highs following the announcement. Meanwhile, Berkshire's recent $9.7 billion acquisition of Occidental Petroleum's petrochemical unit, OxyChem, underscores its continued pursuit of large-scale industrial investments.

The company's insurance operations remain a key driver, with underwriting income surging to $2.37 billion in Q3, a 200% increase year-over-year. This performance was bolstered by unusually low natural disaster activity during the period, according to Bloomberg Law. However, net investment income declined 13% to $3.2 billion due to falling short-term interest rates, Bloomberg Law also noted.