Berkshire Hathaway Struggles After Buffett's Departure

In the months leading up to August 2025, Berkshire Hathaway has faced a series of challenges following the announcement of Warren Buffett's departure as chief executive at the end of 2024. The company reported a 59% decline in quarterly net income on August 2, 2025, largely due to a $3.76 billion write-down on its stake in Kraft Heinz. Berkshire's investment in the struggling food company has proven to be a rare disappointment for Buffett, with the carrying value of the stake now marked down to $8.4 billion, down from more than $17 billion at the end of 2017. Additionally, Berkshire's stock has fallen more than 12% and lagged the Standard & Poor's 500 by about 22 percentage points since Buffett's exit was announced in May 2024. Analysts have attributed this to the erosion of the premium embedded in Berkshire's stock price due to Buffett's presence, as well as a potential slowdown in the insurance sector, a major profit center for the conglomerate. The company has also reported lower quarterly operating profit as insurance underwriting premiums declined. Furthermore, Berkshire's consumer goods businesses, including companies such as Fruit of the Loom, Jazwares, and Brooks Sports, have faced a 5.1% revenue decline in the second quarter of 2025 due to lower volumes, tariffs, and business restructurings. These challenges come as Berkshire Hathaway transitions to new leadership, with Vice Chairman Greg Abel set to replace Buffett as CEO at the end of the year. The company's ability to navigate these headwinds and maintain its strong performance will be closely watched in the coming months.