Free NewsletterPro Login

Warning: Undefined variable $stocks in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 448

Warning: foreach() argument must be of type array|object, null given in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 448

Warning: Undefined variable $funds in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 472

Warning: foreach() argument must be of type array|object, null given in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 472
/* the link was here */

Abel Puts Berkshire's Massive Cash Reserve to Work as Operating Profit Jumps 16%

Published Aug 8, 2026
Share:
Summary:
  • Berkshire Hathaway's second-quarter operating profit rose 16% year over year to $12.98 billion.
  • Berkshire repurchased about $4.5 billion of its own stock in Q2, up from $235 million in Q1.
  • Berkshire ended June with $365.5 billion in cash, down from $397.4 billion at the end of the first quarter.

A Solid Quarter, Powered by Everyday Businesses

The increase came from Berkshire's energy, railroad, and manufacturing operations, which outweighed softer insurance results. More importantly, the numbers indicate that Greg Abel, 64, has started directing the enormous cash reserve built by Warren Buffett toward share repurchases and stock investments.

Operating profit reached $12.98 billion in the quarter, compared with $11.16 billion in the same period last year. The manufacturing, service, and retailing segment generated $4.47 billion, up 24%. Berkshire Hathaway Energy's profit climbed 27%, reaching $891 million. BNSF, Berkshire's rail carrier, earned $1.56 billion, up 6%.

Insurance lagged. Underwriting income was $1.73 billion, down 13% from the $1.99 billion reported a year earlier. Insurance investment income was $3.06 billion, 9% lower. The weakness in insurance was enough to stand out, but the rest of the company grew enough to push operating earnings higher.

Abel Starts Putting the Cash to Work

Greg Abel, 64, became CEO at the beginning of 2026, making this his second fiscal period as CEO. The $4.5 billion buyback was a significant increase from the $235 million in buybacks during Q1 2026, though it may have been below some forecasts ahead of the results.

Get the free Always Be Buying eBook and learn the simple system for building wealth on any income

The decline in Berkshire's cash balance reflected both the buybacks and other capital deployments, including the completion of Berkshire's acquisition of Taylor Morrison during the quarter.

The latest results also show how much the balance of power has changed: Abel is now the one making capital-allocation decisions. Berkshire's operating businesses range from the BNSF railroad and Berkshire Hathaway Energy to insurance and a large manufacturing, service, and retailing segment. Taylor Morrison adds homebuilding to that group, and the reduced cash balance shows Abel is willing to use Berkshire's firepower in several directions at once.

Berkshire also ended its run as a net seller of stocks. In Q2, Berkshire purchased nearly $20 billion more in equities than it sold. The company had sold more stock than it bought for 14 straight quarters before that.

Buffett, now chairman, left Abel a fortress of cash unlike anything corporate America had ever seen. That fortress is still enormous, but Abel has started to put it to work through buybacks and stock purchases.

What It Means for Investors

The shift is notable because of how long Berkshire stayed in a defensive mode. For 14 consecutive quarters, the company had been selling more equities than it purchased, and its Q1 buyback total was only $235 million. In Q2, that changed: the buyback jumped to $4.5 billion, and net equity purchases reached nearly $20 billion.

The cash pile still stands at $365.5 billion, so Berkshire retains enormous firepower. But the latest numbers suggest Abel is willing to pull the trigger when he sees value, while still stopping short of emptying the fortress all at once. Investors will be watching whether this quarter marks the beginning of a more aggressive deployment of Berkshire's cash pile, or whether the pace will stay uneven as Abel calibrates valuations.

For now, the second-quarter numbers make the strategy clear: Abel has stopped merely guarding Buffett's enormous cash reserve and has started deploying it.

Download the free Always Be Buying eBook and start putting your money to work today

Disclosure

Recent News

1 2 3 … 93

Get Market Briefs delivered to your inbox every morning for free!

No fluff. No noise. No politics. Just finance news you can read in 5 minutes.

Blogs

October 5, 2026
What Is the Briefs Connector? A Simple Guide
  • The Briefs Connector lets your favorite AI read Briefs research, like Pro reports and the Briefs Score.
  • Without it, an AI asked about investing can give answers that sound right but aren't backed by that research.
  • It explains the research, but it won't tell you what to buy or sell.
Read More
October 5, 2026
Is a Recession Coming? What the Last Five Rate Hiking Cycles Say
  • The Fed has started raising rates again, and in the last five hiking cycles going back to 1994, a recession never started while the hikes were underway.
  • The pain showed up where there was a bubble to pop - housing in 2008, dot-coms in 2000, the pandemic money-printing boom in 2022 - and usually after the hikes ended.
  • Private equity and private credit are feeling this cycle first, and how far the pain spreads depends on how high rates go and how long they stay there.
Read More
October 2, 2026
Fed Interest Rates May Rise Again in 2026 - and the Newest Culprit Is AI
  • Fed Governor Barr told a meeting our head of investing research attended that higher rates are likely in 2026, lower inflation may not come soon, and AI is now pushing prices up.
  • The same week, President Trump asked the biggest AI companies to police themselves under an accord that's morally but not legally binding, because the White House sees AI as a race with China.
  • Higher rates put downward pressure on asset prices and squeeze borrowers, but the way through hasn't changed: own investments, buy on a schedule, and treat downturns as discounts.
Read More
October 1, 2026
Housing Market 2026: Why Office Buildings Are Cracking Before Houses Do
  • Office buildings are selling for 80% to 95% off because their five-year loans are resetting at much higher rates while half-empty floors have gutted the income those buildings are valued on.
  • Housing is under pressure, not cracking: a $400,000 mortgage costs $975 more a month than at 3%, but six of every seven mortgages are still under 6% and those owners are staying put.
  • Whether pressure turns into cracks is a race between unaffordability and the economy, and either way Jaspreet's rule is to treat your house as a liability and buy only what you can afford.
Read More
September 30, 2026
Dividend Investing vs. Growth Investing: Why the Slower Portfolio Can End Up Bigger
  • "What stock should I buy?" is the wrong first question. Growth, income, or wealth preservation comes first, and the goal changes which stocks even make sense.
  • At $500 a month for 30 years, 13% growth builds about $1.75 million. 10% growth plus a reinvested 4% dividend builds a little more than $2.2 million and pays a little more than $80,000 a year.
  • Income investors have US dividend ETFs, REITs, and international dividend funds to study. Growth investors have the Nasdaq 100, AI and chip funds, and small caps. None of it is a recommendation.
Read More
September 29, 2026
Why Is Gold Going Down? A 5.2% Treasury Yield Just Took Its Job
  • President Trump rejected Iran's deal to reopen the Strait of Hormuz, oil prices jumped back up, and gold fell instead of rising.
  • Treasury yields hit their highest level in more than 20 years, so investors sold gold and bought Treasuries that pay interest.
  • Higher Treasury yields make the national debt, mortgages, car loans, and credit cards more expensive, with the Fed's next rate decision due October 28.
Read More
September 28, 2026
The Strategic Bitcoin Reserve: Why the Government Wants Bitcoin to Explode
  • The US government holds about 328,000 Bitcoin, worth roughly $25 billion, and since a 2025 executive order it keeps seized coins instead of selling them.
  • Washington wants a bigger pile of assets so its $40 trillion national debt looks smaller next to them, which lets it keep borrowing and spending.
  • Bitcoin's wild price swings, and a government holding a coin built to escape governments, are the two risks investors need to watch.
Read More
September 25, 2026
BRIEFS EXCLUSIVE: 43% Of Respondents Say Bills Outran Their Income Over Past Two Years
  • 43% of the 494 Market Briefs readers surveyed said their bills grew faster than their income over the past two years, even though 79% could cover a surprise $5,000 expense tomorrow.
  • Half of readers own gold or crypto, the two classic bets against a weaker dollar, and only 13% bought nothing at all in the last 12 months.
  • The median reader says it takes $150,000 a year to feel financially secure, about $62,000 above the U.S. median household income.
Read More
September 25, 2026
The Economy Is Booming. So Why Did Stocks and Bonds Fall Together?
  • S&P Global says the US economy is growing at its fastest rate since 2021, with corporate profits up 28.9% in a year, almost four times the historical average.
  • Stocks and bonds fell at the same time, which is not how the two markets normally behave, because Treasury yields above 5% now compete with stocks for investors' money.
  • Jaspreet Singh lays out three ways to invest through a shift like this: always be buying, buy the crash, or follow the money before it hits the headlines.
Read More
September 24, 2026
The 2026 Economic Reset Is Starting: Are We in a Recession, or Is the Pain Still Ahead?
  • The Federal Reserve has flipped from stimulating the economy to fighting inflation with higher interest rates, while the White House still wants growth at almost any cost.
  • The national debt tops $40 trillion, has outgrown the entire U.S. economy, and its interest payments are now the government's fastest-growing expense.
  • Higher rates bring pain for private equity, private credit, and speculative assets, but they open opportunities for investors holding cash, treasuries, and value assets.
Read More
1 2 3 … 28
Share via
Copy link