Warren Buffett's Berkshire Hathaway Takes Big Hits on Kraft Heinz and Paramount Global Investments

Warren Buffett's Berkshire Hathaway recently took significant losses on its Kraft Heinz and Paramount Global investments, totaling billions of dollars. Buffett, set to step down as CEO, is known for his successful investments in Apple, American Express, and Coca-Cola, among others. Berkshire Hathaway's class B shares fell nearly 3% on Monday, bucking a broader rally, after the company reported a decline in operating earnings in the second quarter.

Berkshire Hathaway, the conglomerate run by legendary investor Warren Buffett, reported significant losses on its Kraft Heinz and Paramount Global investments in the second quarter of 2025. The company, which also owns companies like GEICO, BNSF Railway, and Dairy Queen, recorded a nearly $5 billion write-down of Kraft Heinz shares [1]. This loss was classified as "other-than-temporary," leading to a pre-tax loss of $4.99 billion on the stock.

The quarterly report also highlighted a 3.77% decline in operating earnings from the same period last year, with total operating earnings slipping to $11.16 billion. The company's cash pile decreased to $344.1 billion, down slightly from $347.7 billion at the start of the year [3].

Buffett, who is set to step down as CEO at the end of 2025, announced the appointment of Vice Chair Greg Abel as his successor. Abel's appointment was approved by the company's board following the annual meeting on May 3 [3].

Despite the losses, Berkshire Hathaway's class B shares have risen just over 4% since the start of the year, lagging the 6% gain by the benchmark S&P 500 index. Last year, Berkshire shares rose 27%, slightly outpacing the broader market [1].

Buffett's investment strategy, known for its focus on long-term, dividend-paying companies, has been a key driver of Berkshire Hathaway's success. The company's stake in Coca-Cola, for instance, generates approximately $816 million in annual dividend income, demonstrating the enduring value of Buffett's investment philosophy [2].

However, the company's earnings report also highlighted the impact of geopolitical events and trade policies on its businesses. Berkshire Hathaway warned that President Donald Trump's tariff policies could have adverse consequences on its operations and investments [3].

The company's energy and railroad companies reported earnings increases, with BNSF Railway's earnings before taxes up 11.5% and BHE net income climbing 18% [3]. Despite these gains, the broader market's rally was not reflected in Berkshire Hathaway's shares, which closed at $472.84 on Friday, up 4.82% since the start of the year.

References:
[1] https://finance.yahoo.com/news/warren-buffetts-berkshire-hathaway-records-131437540.html
[2] https://finance.yahoo.com/news/warren-buffett-berkshire-hathaway-now-124321343.html
[3] https://www.cnn.com/2025/08/02/business/berkshire-hathaway-earnings-warren-buffett