Veteran leader stuns investors with retirement from trillion dollar company
A 62-year-old hockey fan born in Edmonton, Alberta, is to lead the first non-tech company to reach a U$1 trillion valuation when he takes over the role of CEO at Berkshire Hathaway at the end of 2025.
Greg Abel certainly has big shoes to fill in succeeding Warren Buffett, who announced he will be stepping down over the weekend. But with two decades at Berkshire including seven years as vice chairman of the company’s non-insurance operations he has served his apprenticeship. He is also executive chairman of Berkshire Hathaway Energy and has been preparing to lead the parent firm since he was named as heir apparent to Buffett in 2021.
“Greg is ready. I have no doubt about that. We’ve known if for a long time,” longtime Berkshire board member Ron Olson told CNBC on Saturday.
Abel's rise to the elite among corporate leaders started in a working-class background and an early foray into business - delivering advertising flyers and cleaning discaded bottles to redeem for cash, according to a profile by the Horatio Alger Association of Distinguished Americans, which Abel serves as president. Abel was later an accountant with PwC and in business became a senior executive of CalEnergy, which later became MidAmerican Energy Holdings Company where he rose to president, CEO and chairman by 2008. The firm became Berkshire Hathaway Energy in 2014.
The next chapter of his story will begin as Buffett retires having built an enviable portfolio of businesses and other investments over six decades: “I think the time has arrived where Greg should become the chief executive officer of the company at year end,” Buffett said at the weekend.
But not retirement from his involvement with the firm he has grown from a failing Massachusetts textiles business into the behemoth it is today; he will remain with the business in some capacity and has no plans to divest any of his stock.
While it should perhaps not be a surprise for someone of Buffett’s 94-year vintage to decide that the time is right to give up the day job, the timing comes on the back of disappointing earnings for the company, and his retirement has overshadowed the quarterly stats to some degree. “That’s the news hook for the day,” Buffett said on making the announcement, showing his canny understanding of how to control your own PR.
Berkshire Hathaway’s first quarter reflects challenging times with operating earnings down 14% to $9.6 billion from $11.2 billion a year earlier with net investment losses of $5 billion, down from a net $1.4 billion gain in Q1, 2024.
A key part of the story is that underwriting profit for Berkshire’s insurance business fell more than 48% in the quarter to $1.3 billion from $2.6 billion in the same period of 2024.
And the earnings release notes that the uncertainty around tariffs and other current trade policy makes it hard to accurately envisage what may be ahead.
“Changes in macroeconomic conditions and geopolitical events, including changes in international trade policies and tariffs, may negatively affect our operating results and the values of our investments in equity securities and of our operating businesses. We are currently unable to reliably predict the nature, timing or magnitude of the potential economic consequences of any such changes or the impacts on our Consolidated Financial Statements,” the release stated.
While the earnings are below expectations, the company remains in a strong position with cash holdings of almost $350 billion. How that cash mountain may be deployed – the firm opted not to buy the dip as stock plunged in the wake of tariff announcements – is a key question as Abel prepares to takes the reins. But so too is whether Berkshire will still be seen in the same premium terms without Buffett in the CEO seat.
