2026-Part 2-BRK Annual Shareholders Meeting

Summary

Berkshire Hathaway Annual Shareholders Meeting 2026 – Part 2

Date: May 3, 2026
Host: Becky Quick (with guests Warren Buffett, Greg Abel, Katie Farmer, Adam, et al.)

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Episode Overview

This episode features highlights from the 2026 Berkshire Hathaway Annual Shareholder Meeting, marked by a new era: Warren Buffett, for the first time in 60 years, watches from the audience as Greg Abel and other key leaders take center stage. The session covers Buffett’s reflections on his “retirement” as CEO, his views on the investing climate, comments from major Berkshire executives, deep-dive Q&A with shareholders, and insight into leadership, succession, technology, and Berkshire’s distinctive decentralized culture.

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Key Highlights and Discussion Breakdown

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1. Warren Buffett’s Reflections as Former CEO

• Transition Reflections: For the first time since 1965, Warren Buffett attends the meeting as chairman, not CEO (00:00).

  • Buffet feels “it’s working,” citing confidence in current management and the freedom in Berkshire’s model to “pick our spots” (00:34–01:14).
  • Quote: “We got the right management, we got the right arrangement, and ... nobody can tell us what to do.” – Warren Buffett (00:36)

• Investment Environment:

  • Buffett notes a record ~$380 billion cash on hand due to “no good deals”—deals that make sense and are understandable are rare today (01:44–03:05).
  • He observes that today “the casino’s gotten very attractive to people,” equating market speculation to gambling more than investing (04:07–05:44).
  • Quote: “The markets [are] like a church with a casino attached... we’ve never had people in a more gambling mood than now.” – Warren Buffett (04:07)

• Waiting for Opportunity:

  • Most “juicy years” for investment only come a few times in a career; best opportunities arise during periods of panic when “nobody answers their phones” (05:44–07:59).

• On Unpredictability:

  • Major market panics are unexpected; ”If you saw them, they wouldn’t happen.” Worrying about such events is unproductive (07:59–09:42).
  • Quote: “If it’s something people are talking about and thinking about, it’s not going to happen. But there are things that can happen out of the blue…” – Warren Buffett (08:22)

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2. Macro Environment: Inflation, Rates, and Market Risks

• Handling Inflation:
  • Runaway inflation devastates economies and is unmanageable; current (2026) levels (~3%) are manageable, but policy mistakes can be catastrophic (09:42–12:40).
  • Historical context: “What not having faith in the money does to a country, it turns it into something else.” (11:04)
• Views on Jay Powell/Leadership at the Fed:
  • Buffett expresses relief that Powell remains at the Fed after stepping down as chairman: “I’ll feel better when he’s there. When he’s not…” (13:00).
  • Quote: “It’s what you don’t think of that does all the damage.” – Warren Buffett, on macroeconomic surprises (13:00–14:08)

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3. Succession, Leadership, and Culture

• Stable Portfolio – Manager Transitions:
  • Discussion on Tim Cook’s success at Apple, recent CEO changes at Coca-Cola and Occidental. Holding companies remain stable if managers are strong, but transitions always carry risk (14:18–15:44).
  • Buffett humorously compares CEO selection to marriage: “Look at the divorce rate—that’s more important than whether you got the right CEO!” (15:59)
• Greg Abel as CEO:
  • Chosen for business acumen, not simply being “a nice guy;” currently seeking US citizenship, symbolic of American “secret sauce” (18:49–21:44).
  • Quote: “America’s special… There is some secret sauce. I’ve never been able to define it precisely…” – Warren Buffett (20:00, 21:58)
• Buffett’s Life Lesson:
  • The “golden rule” as guiding principle: “If the whole world lived by the golden rule, it would [be] such a more wonderful society.” (24:00–24:52)

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4. Deepfakes & AI Concerns

• Buffett expresses concern over AI and deepfakes, referencing a realistic deepfake of himself: “It’s scary… particularly when you have nine countries or so with nuclear weapons… we don’t know what’s going to happen.” (17:32–17:57)

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5. BNSF Railway – Leadership, Innovation, and Long-Term View

• Katie Farmer (CEO, BNSF Railway):
  • BNSF’s 177-year history built on adaptability, customer focus, and innovation (26:01–31:38).
  • Introduction of “BNSF Tech” for in-house technological innovation – not for tech’s sake but for real outcomes: safety, service, productivity.
  • Inspired by Warren—think of it “as if it were our own family’s company.”
  • Quote: “Warren always challenges us to think about the businesses that we lead as if it were our own family’s company.” – Katie Farmer (30:00)

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6. Q&A With Shareholders: Leadership & Operations

6.1 Geopolitical and Macro Risks

• Middle East Impacts:
  • Greg Abel: Business approach is long-term, “heads down”; challenges (e.g., rising input costs due to petroleum price spikes) managed by focusing on customer needs and operational resilience (39:46–43:51).
  • BNSF’s mix of commodities offers both opportunities (increased demand for some commodities) and risks (fuel costs), but prolonged high fuel prices could impact consumer demand (44:10–46:31).
  • Adam (NetJets): Jet fuel price spikes are manageable until they become prolonged; similar impact across various subsidiaries (46:39–47:41).

6.2 Decentralization & Performance

• Maintaining Decentralized Ownership:

  • Greg Abel reaffirms faith in decentralized model—subsidiary CEOs are closest to customers and held accountable for risk, capital, and performance (49:03–52:20).
  • Quote: “We treasure continuous improvement and operational excellence…if we see a performance gap, that’s when we engage.” – Greg Abel (52:20)

• BNSF’s Competitive Edge:

  • Katie Farmer: Focus on operational efficiency, capitalizing on technology (AI, digital twins, predictive ETAs), and tackling major cost categories, especially as trucking technology evolves. Regulation must allow railroads to innovate to remain competitive vs. autonomous trucks (52:39–56:19).
  • Quote: “The technology will continue, just like most industries… We’re going to need regulation that allows the railroads to compete.” – Katie Farmer (56:19)

6.3 Dealing with Underperformance & Debt (NetJets Case Study)

• Adam describes turning around NetJets by instilling safety and service focus, interdisciplinary knowledge, and attention to reducing company debt (59:23–61:27).

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7. Shareholder Q&A – Tariffs, Global Strategies, and Breakup Rumors

7.1 On Tariffs

• Tariff effects are real but managed: Forward planning by customers led to demand surges; the uncertainty is more damaging than tariffs themselves, causing deferred investment (61:38–67:18).

7.2 On International Partnerships & Expansion (Tokyo Marine)

• Recent Tokyo Marine deal: Deeper strategic partnership and long-term integration, yet not a signal of a major shift—future active international partnerships are possible if the right fit/culture is found (67:28–70:30).

7.3 Breaking Up Berkshire?

• Greg Abel: Would divest a business if:
  • Berkshire couldn’t be the best owner,
  • The business became unsustainable,
  • There were irreparable reputational risks,
  • Regulatory compacts (esp. energy) break down.
• But: “Absolutely not” on breaking up the conglomerate; Berkshire’s structure is efficient, minimizes bureaucracy, maximizes tax efficiency, and facilitates long-term capital allocation (72:30–80:22).
  • Quote: “We don’t have layers of management… So many conglomerates end up with layers and layers of cost that don’t add value.” – Greg Abel (78:15)

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8. Leadership Style & Future of Berkshire

• Margin of Safety & Technology:
  • Abel aligns with Buffett’s margin of safety—evaluate opportunities over a 10-year window; tech companies can fit if risks and cash flows are understood (81:03–85:00).
• Who Is Greg Abraham’s “Charlie”?
  • No direct equivalent to Charlie Munger, but Abel relies on Warren as chairman, a strong board, and the culture of cross-company counsel among CEOs/Ajit Jain (86:46–90:18).
  • Quote: “You can’t replicate that [Buffett & Munger] partnership... but we have an immense amount of resources around us.” – Greg Abel (87:10, 90:18)

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Notable Quotes & Moments

• Buffett on Market Cycles: “Five years in 60 were really juicy… You just wait for your pitch.” (02:08)
• On Macro Uncertainty: “If you saw them, they wouldn’t happen.” – Buffett, on predicting panics (07:59)
• On America: “America’s special… there is some secret sauce.” – Buffett (21:58)
• On Leadership Principle: “If the whole world lived by the golden rule, [it would be] a more wonderful society.” – Buffett (24:52)
• Greg Abel on Breaking Up Berkshire: “Absolutely not... We see our conglomerate structure working without bureaucracy and bloated costs.” (76:59–78:27)

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Timestamps for Important Segments

• Buffett’s New Role & Reflections: 00:00–03:49
• Investment, Market, and Macro Discussion: 03:49–05:44
• Best Opportunities/Market Cycles: 05:44–09:42
• Inflation, Currency, and Confidence in the Fed: 09:42–14:08
• Leadership, Succession, Greg Abel’s Citizenship: 14:08–21:44
• BNSF Railway Deep Dive (Katie Farmer): 26:01–31:38
• Q&A: Geopolitical Risks: 39:32–47:41
• Q&A: Decentralization & Improvement: 49:03–52:20
• Q&A: Trucking/Technology Competition: 52:39–56:19
• Q&A: Tariffs: 61:38–67:18
• Q&A: Tokyo Marine & International Strategy: 67:28–71:37
• Q&A: Will Berkshire Break Up?: 72:02–79:48
• Q&A: Margin of Safety & Technology: 81:03–85:00
• Q&A: Who’s Greg Abel’s “Charlie” Now?: 86:46–90:18

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Final Message

Buffett’s Closing Advice to Shareholders:
“Just follow the golden rule—do unto others as you’d have them do unto you. It doesn’t cost you anything, and it’s reflected in better behavior toward you.” (24:00–24:52)

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Tone: Warm, candid, and practical—with classic Buffett humor, humility, and deep insight throughout. The “Berkshire system” is shown to be not only intact, but vigorously operational for its era after Buffett’s tenure.

End of Summary

Transcript

[Becky Quick]

Mike, thank you very much. And I want to welcome everybody back in the arena. Make sure you're getting time to get back to your seats. I know we didn't give you a lot of time for a break, so I hope you made it to the bathroom and you're back and getting ready to sit down. We are sitting down right now with Warren Buffett, the chairman of Berkshire Hathaway, who for the first time in 60 years has been watching all of this from the audience instead of being on stage. And, you know, last year at this time, Warren, you surprised everyone with the announcement that you were stepping down as CEO. Fast forward a year, and here we are. What do you think?

[Warren Buffett]

Well, I think it's all working. It's all working. It isn't our ideal surrounding area or environment, I should say, in terms of deploying cash for Berkshire, but in terms of how we got the right management, we got the right arrangement, and, you know, we can pick our spots and nobody can tell us what to do. Exactly. And so sometimes we're doing nothing, but other times we get quite active.

[Becky Quick]

I mean, you know, Ajit spent some time on the stage today talking about how one of his keys is to do nothing when it comes to insurance, when it comes to writing insurance, which is the same thing that you have always talked about with whether to invest or not.

[Warren Buffett]

Yeah, the world is full of people that are offering you things to do, and then the question is to find one that you know makes sense, and there may be 20 out there that make sense that you don't understand, and you just leave them alone.

[Becky Quick]

You said that the world or the surrounding environment is not ideal. And I guess that points to the idea that there's almost $400 billion in cash on hand, although Greg took some pains to show it's really more like $380 billion in cash on hand. But there's a lot of cash on hand, and you're still active in managing the portfolio, too, and looking at stocks. You're looking around and you don't see a lot that you want to invest in.

[Warren Buffett]

Well, then we don't do anything. I mean, we've been in up to 60 years I've been in the business. You know, it probably five of them. Really juicy, you know. And I think it was Tom Watson Sr. Of IBM that said they asked him the reason why IBM had been so successful or something like that. And he said, I'm smart at spots and I stay around those spots. And that's. That's the whole thing. And IBM was in Three different businesses including time clocks and a couple and two of the three turned out to be no good. But so they just focused on the one.

[Becky Quick]

What is it when you look around? It's just prices are too high at this point I would imagine there. Greg said this from the stage too. There are businesses that you like well

[Warren Buffett]

and I would say I understand fewer of the businesses as a percentage of the whole than I did 10 years ago. I have not learned new industries for some years, you know and so I don't kid myself on that. I'm not going to learn, I'm not going to have an edge on, you know, a whole bunch of younger people that have actually grown up with them, used the product, seen things. But well as I mentioned, you know, you don't have to understand too many of them like Apple

[Becky Quick]

but looking around. Let's just get some macro thoughts on this because I don't know that this is something that, that Greg is going to comment on per se. Just looking at the macro stock market environment, what does this feel like to you? Is. Does it feel expensive? Does it feel like there are opportunities in.

[Warren Buffett]

Well, it feels, you know, I've compared the markets to a church with a casino attached and people can move between the church and casino and I would say there are more people in the church and more people in the casino. But the casino's gotten very attractive to people. You know, if you're buying one day options or selling them, I mean that is, that's not investing, it's not speculating, it's gambling just totally. There's nobody that can explain why they're buying an option for one day unless they maybe the fellow that made the four hundred and some thousand dollars from knowing when we were going into Venezuela could do it. But I mean that's pretty. And the quantity of those things is just incredible. So we've never had people in a more gambling mood than now. But that doesn't mean that investing is terrible. It does mean that, that prices for an awful lot of things will look very silly. I mean they, you know, they had a squeeze and then in Avis of all things. Well, Avis has been around for 50 years but just this past week and we have lots more regulation and everything now. But. But people spend their time figuring out how to get around the rules rather than follow the rules. That's just a challenge.

[Becky Quick]

The type of investor you are. Those is you laid it out yourself in the 60 years you've been doing this in the business you've had maybe five juicy years I guess that means you're always looking for the next juicy year. What do you think it would take to make a juicy year or a juicy opportunity for you?

[Warren Buffett]

It's a phone call and many in some cases, you know, we bought a business last year. It was, it wasn't big enough to be meaningful, but we got a letter.

[Becky Quick]

Bell Labs.

[Warren Buffett]

Yeah, Bell Labs. And you know, and sometimes there's more zeros attached to them than others and we're big enough to handle anything and we can make decisions faster than anybody and our word is good. There's an awful lot of people that when they, they're in the business of reselling something or, you know, it's, and it's a lot better if you're a good salesperson. There's no reason to be selling vacuum cleaners or you know, as well stock. You'll make way more money. It's where the money is. And there's, and there's more money around than ever.

[Becky Quick]

But the best opportunities have probably come when the macro environment needs to change.

[Warren Buffett]

Well, the most likely time to buy things is when nobody else will answer their phones. You know, everybody else talks about their wonderful trading departments and everything. Just try them out sometime. When markets are collapsing, they don't answer the phones and if they do, the bids are subject and the offers are subject and the spread is wide and they'll use the information they get from you about what you want to do to go out and kill you some other way. I mean, it's really like going to a slaughterhouse. I mean, you don't feel like eating hot dogs for a while.

[Becky Quick]

I guess what I'm trying to get at is do you see the circumstances building up anywhere that could lead to a time like that again, any sort of panic in the market? Where do you see them?

[Warren Buffett]

Well, if you saw them, they wouldn't happen.

[Becky Quick]

Okay.

[Warren Buffett]

I mean, you've got all kind. You don't worry about what people are talking about can happen. It's something that comes out of the blue. But something will come out of the blue. I mean, a nuclear bomb can come out of the blue, you know.

[Becky Quick]

Well, let's knock on wood on that.

[Warren Buffett]

Well, it doesn't do any good to knock on wood. That's the point. It was the Archduke getting shot, you know, in 1914 or something like that for World War I. It just take everything in life and. If it's something people are talking about and thinking about, it's not going to happen. But there are things that can happen out of the blue and Actually, that's particularly true to use that phraseology now, because the things that can come out of the sky, you know, we don't know what can happen tomorrow. I don't like to talk that way to people, whether it's you or anybody else, Whether it does you a lot of good to worry about that. I don't think it does do any good to worry about it. I think it's good to be cognizant of it. But worrying about it is terrible. I don't like to even cause that belief with people. I don't like to go around, tell them the end is coming, the end is coming, or something like that.

[Becky Quick]

A friend told me yesterday he's recently started using the phrase, I don't fret, I don't worry. And that's probably a good way to go about life. But let's talk about some of the issues that are out there right now. Inflation is up. That's. So how does Berkshire. How does Berkshire handle that with its business?

[Warren Buffett]

Well, we can't handle runaway inflation, except not to be there in the way of it. And if you look at the number of countries that have had runaway inflation Since World War II, you know, in my lifetime, it's very large, you know, and once you create that, it becomes a different world. You know, Germany obviously, very soon after World War I. But there are dozens and dozens of countries that have experienced it. And of course you have countries that gone bankrupt like six or seven times. I mean, it's just amazing what people do in financial markets.

[Becky Quick]

What about the inflation that we're dealing with right now, which is, you know, not excessive. It's north of 3% at this point, but we're not even back at the levels we were during COVID about 8 to 9%. So what about just higher energy prices, how that works through the line and how you handle it?

[Warren Buffett]

Well, it came close before Volcker, I mean, it was just. It was cash is trash and people were losing faith in the currency and they felt they could borrow and 12% earn, 6% on farming or something like that. And they had huge farmers in this state. Nebraska collapsed because they bought beyond the earning power, their paid interest rates beyond the earning bar, just because they felt that the dollar was going to disappear and the land wouldn't disappear. And it's tragic for many people, If you're the best doctor in town or the best lawyer in town, you'll always make money under any choice. The best, the best TV personality. But what not having faith in the money does to a country, it turns it into something else. And I've always hoped that the US never does it. But we are not immune from it happening. We have a lot of control over whether rates may go up a half a point or down a half a point, but we may have less control over whether they go up 50 points.

[Becky Quick]

You've long been a supporter of Jay Powell's.

[Warren Buffett]

Exactly.

[Becky Quick]

He had his last FOMC meeting as chairman just this last week. He did say that he's going to be sticking around, staying on the Fed, staying in that position for this foreseeable future, in part because of the threats that he's faced.

[Warren Buffett]

I'll feel better when he's there. When he's not. I mean it. I just felt better when Volcker was there. But you economists aren't the best at this sort of thing. Read any old economics book from 1950 or 1970. Paul Samuelson was a terrific guy and smart as hell. He had the standard textbook for 25 years and if you looked up, you know, zero interest rates and year after year after year, it was a 900 page book and it wasn't an entry for it. You know, I mean, it was the most important economic development, I mean, in terms of the impact it would have and everything during the lifetime of the students reading it. But it's what you don't think of that does all the damage.

[Becky Quick]

Let's talk a little bit about CEOs in some of the Berkshire holdings. You mentioned Apple's Tim Cook, and just the phenomenal job you think he's done.

[Warren Buffett]

Incredible.

[Becky Quick]

He's not the only one of your major holding CEOs who stepped down. James Quincy recently stepped down from Coca Cola, too. And we just spoke with Vicki Hollab, who announced that she is retiring and stepping down from that position at Occidental. Part of what Greg's talked about is how stable that portfolio is. And, and these holdings are companies that he knows and managers that he, that he knows could be some new managers in some of those major holdings coming in. Is that a problem?

[Warren Buffett]

Well, it was certainly a problem with Coca Cola there for a good many years when I was around the company. Sure. And you have the most problems with a really good company because it'll continue. I mean, if you're selling some product that people are buying every day, you can make the wrong decision for a long time. But that's one of the problems with investing. Tim Cook, I felt, was very, very good from the start. And most of our managers are very good at the smaller problems. They can't anticipate the. The overwhelming problems. That's. That's my job or now Greg's job.

[Becky Quick]

Do you feel good about those holdings still? Have you met any of the new managers of those businesses?

[Warren Buffett]

Not the old manager of the new

[Becky Quick]

businesses, of the new CEOs that are coming in placement. You know, Enrique at Coca Cola.

[Warren Buffett]

I certainly met the people at Bell Labs that we. Yeah. You know, and obviously I met Vicki. We made the deal. And so I enjoy meeting with people and. But you can make mistakes with people. I mean, look at the divorce rate. You know, that's more important than whether you got the right CEO or anything else. And now you've got years of trial. I mean, back when I was young, you had to make the decision. You know, you didn't have to make a decision. A good many people made the decision when they were 20 or 21 to get married. Yeah, they got married, and now they spend five years, and they still make the same mistakes.

[Becky Quick]

So you think we're getting worse at our judgment?

[Warren Buffett]

Well, I don't know. Maybe the people behave differently before the marriage than after. Who knows? Exactly. I would say that almost everybody feels either their marriage is better or worse than they anticipated a month after they were married, but I don't know which.

[Becky Quick]

Warren, let's talk a little bit about deepfakes, because the deepfake Warren that popped up early in this session was pretty good. They had somebody standing up. You know, Greg was joking about it. But, you know, the first. The first question went to a guy from Warren up in the rafters who lives in Omaha. You've been concerned about some of these AI deepfakes and what that means for the world.

[Warren Buffett]

Yeah, I would. I would be concerned if everybody was. Well, actually, the worst thing would be to have a really good imitator of any president that came along. I mean, just imagine. Well, yet we had that famous thing before, way back in New Jersey, where they had the Martians coming and everything like that.

[Becky Quick]

War of the Worlds with Orson Wells.

[Warren Buffett]

What you can do? Well, if you convince people to lend you money, you shouldn't be borrowing it. I mean, it's. It's scary. And it's particularly scary when you have nine countries or so with nuclear weapons and people working on something even more. We haven't dealt with this. We don't know what's going to happen.

[Becky Quick]

Let's circle back to Berkshire and the Berkshire of today. I think I was speaking with you yesterday or the day before, and we were talking a little bit about Greg Abel and what A nice guy. He is.

[Warren Buffett]

He's a terrific guy.

[Becky Quick]

You said something interesting to me, though, about how you picked him, and it wasn't because he was a nice guy. Why did you pick him?

[Warren Buffett]

Well, he's very, very, very smart about businesses. Incidentally, he's getting his Canadian. I mean, he's getting his American citizenship here very soon. And he was going over with me all the things he had to learn about. And I've actually spent a little time in the past with groups of individuals. Of course, my wife still became an American citizenship, American citizen. And the things they have to learn about the Constitution and all these. And they're usually so proud when they become American citizens. And I think I detect even, I mean, you know, as successful he's been and everything else, I mean, he is. It means something to him to become an American citizen. And, you know, he sits there with his young son, you know, and so knows more about some of the answers to the questions, you know, that he may get asked or something about becoming a citizen. It's really interesting. Where else does that happen in the world? I mean, what people? You know, America's special. And it's a miracle what America's accomplished. I mean, it's just an absolute miracle. And yet the miracle, the division of the output and everything is about as inequitable as it you could come up with. While at the same time it's got these great attractions. There is some secret sauce. I've never been able to define it precisely, but when you run a country for 200 and some years and people want to come here every year, I mean, there's really something about it. And what Greg Abel is very, you know, is looking forward to, to becoming an American citizen that means something to them. And you can't buy that any place they're packaging, you know, it won't work for a Madison Avenue approach, you know, being American or something like that, but that feeling just goes in my 95 years, I've seen it time after time. So I felt good when I. Greg just volunteered that in the last day or two to me that he was up there for his final exams here pretty soon becoming a citizen.

[Becky Quick]

I didn't realize he wasn't a dual citizen already. I knew he was Canadian, but I thought he had dual citizens.

[Warren Buffett]

He doesn't have a full. Whatever the complete citizenship requirement is. And you can say, why does he care? I mean, he's gotten along fine without it here and everything. He still wants to be a citizen. Yeah.

[Becky Quick]

250 years. We're celebrating our 250th anniversary. You pointed out that you've been around for 95 of them. You think we have the special sauce that that will continue in this country or what do we need to do to preserve that and make sure that it does continue?

[Warren Buffett]

We've got a special sauce, a secret sauce. It's such a good secret that I don't know what exactly it is. But I do know this, that anybody that has a choice would choose to be born in America. I mean, you know, you can pick some very small little country, they're very happy that they're. But this. Is there any other country that everybody's for a couple hundred years has wanted to emigrate to? I mean it. And it attracted some terrible people too, but it worked. And they had the mafias from the different groups, not just the Italian Mafia. But I mean it wasn't that they were all. We had some system for picking out the wonderful people from some other countries. But it has and it has worked. But it's worked. The extremes to which it works don't seem to belong to that kind of a society. I mean if you were drawing up dreams for the ideal society and you would have this kind of GDP per capita and everything, you wouldn't design it wouldn't design the, you wouldn't decide the inheritances. I mean you just do all kinds of things differently. But somehow it's worked. But that doesn't mean that we can't do better, I mean at all.

[Becky Quick]

You know, Warren, there are thousands of people, shareholders and partners of yours for decades in some cases who are sitting out in this arena right now. And I just wonder if there's a message you'd like to give to them. Those have been following you for years and who've been partners of yours for years.

[Warren Buffett]

The number one rule I give them is just not give them the golden rule doing others. I'm not a religious guy, but I mean nobody said it any better in a couple thousand years than that. Which may be why it's lasted to a certain degree too. I mean, you know, more people are reading a 2000 year old book about how to behave than anything that anybody's coming up with lately. Now it's got a lot of, particularly the Old Testament, it's got different kinds of stories to some extent. But if the whole world lived by the golden rule, it would such a

[Becky Quick]

more wonderful society do unto others as you'd have them do unto you.

[Warren Buffett]

Yeah, and that's true for everything from parenthood to being a boss. To being all, I mean, just everything in life. And it doesn't cost you anything. In fact, it's reflected in better behavior toward you. So I mean, it's a very selfish sort of thing in one sense, but I've never seen anybody that's unhappy that behaves that way. And I've seen a lot of people in a lot of different kinds of situations.

[Becky Quick]

Warren, I want to thank you for taking this time to sit down with us today. Warren Buffett, the chairman of Berkshire Hathaway, Greg Abel, is going to be taking the stage in just a moment and you will see more from him in just a moment.

[Katie Farmer]

Okay, we're clear.

We're one seven, seven, year old company and if we didn't have in our DNA the ability to, to adapt and to evolve, we wouldn't be here today and we wouldn't be relevant still in our customer supply chains. And so that adaptability and innovation and really putting the customer first is what we focus on. That's core to who we are. My name is Katie Farmer and I'm president and CEO of BNSF Railway. I have had the pleasure of working alongside the 35,000 men and women of BNSF for going on 34 years now. And I've worked in almost every area of our company, which is how I came to lead BNSF as our CEO for the last five years. We have a long, rich history. We got our start as a six mile railroad in the state of Illinois, a little railroad called the Aurora Branch. And over time that railroad grew into the Chicago Burlington and Quincy Railroad. And then we continued to stitch smaller railroads together to have a route from the Midwest all the way to the Pacific Northwest. We are made up of 390 predecessor railroads. And some of those railroads actually connected with the Pony Express. And our trains were used to sort mail as the train moved across the tracks that then grew into the present day BNSF Railway. We operate in 28 states and three Canadian provinces. Every year we move somewhere between nine and 10 million loads. And we move everything from coal to agricultural commodities to building products, construction products, chemicals. And our largest business segment is our intermodal business. And our intermodal business is the movement of trucks from the highway lifted on a container or trailer onto our railroad. Then we haul it the long portion of the route and then lift it off again from the train to over the road. And to give you some perspective of the scope of what we move, of those 9 to 10 million units, over 5 million are intermodal. So we're the industry leader in intermodal and we lift a container on or off our trains every 4 seconds, 24 by 7, 365 days a year. So that just tells you a little bit about the scope of what we do and how we touch literally every part of the economy. Everything's foundational around safety for us. We're going to lead the industry in service, we're going to continue to be productive and efficient. But one of the things I'm excited about is the next 177 years. And so we're at a point now where we're looking at how do we build that spirit of building and innovation to our technology and our innovation efforts. And so we created BNSF Tech, which is a new division of bnsf and it's really focused on taking that, moving from looking for commercial solutions and buying technology and speeding that process up and building internally. And so we hired a gentleman by the name of Harry Govind, who many of you know, came from GEICO and has a long track record of going in and transforming and innovating. And it's not about technology for technology's sake, it's about outcomes. And so how do we use technology to best position us for the future, to make us a safer railroad, to give the customers a better service product, to drive productivity and efficiency. And so I'm excited about the opportunities we're going to have going forward to really bring that spirit of building to our technology efforts. So I go back to one of the Warren's annual letters to the shareholders and I remember he said that he believed that BNSF would not only be an asset for Berkshire, but an asset for our country 100 years from now. And we take that responsibility very seriously. But we also really appreciate that that aligns well with the way that we have to think about our business. We make investments that are very long, long term investments. And so thinking about that in that longer time frame is really important. Warren always challenges us to think about the businesses that we lead as if it were our own family's company. And you know, I've worked for BNSF since I was 20 years old. So thinking about BNSF as if it's my family's company is not a big stretch for me. And I love that perspective of thinking about how do I make sure that I'm passing this company on so as if it were a family company for the next hundred years to those who will come after us. And with Greg, Greg, it's great to help focus on execution and making sure that every day you're making that business, your family's business, you're making it better. So we are very honored to be a part of the Berkshire Hathaway family. We understand the responsibility that we have, which is to operate every single day with the highest ethical standards and deliver value for the shareholder. And I want the shareholders to know that we have 35,000 proud railroaders who come to work every single day and focus on those two things.

[Greg Abel]

Welcome back. I hope you enjoyed the break. Becky Warren, thank you for that exceptional interview. Appreciate that. Katie and Adam, great to have you on stage. I would note both the videos were extremely well done in that it gives us a great understanding of your businesses, but also you as leaders. And I'm just going to start with a question for each of you and then we'll go to the back to the question and answer. I think Katie, you. Well, I know you did. You heard me speaking earlier. I talked to our owners and shareholders around our operating performance and where we are highlighted. We were in fifth of six last year. We've now moved to fourth and we need to see. We also talked about needing significant improvement, a step change. But the one thing I didn't really

touch on is I started talking about getting to that next level.

But as you touched on, you have 35,000 employees and to move the organization to look externally and recognize where do we go? How do you take on that challenge?

[Katie Farmer]

Yeah. Thank you, Greg. And first of all, thank you for the opportunity to speak today and talk about our great company. It's a pleasure to do that, Greg. So thank you. You know, we absolutely recognize that it's important for us to run an efficient operation, to have a competitive cost structure and to continue to further close the gap between us and our competitors. You know, we have an exceptional leadership team in place that understands the importance of aligning the entire organization. As you said, Greg, the 35,000 men and women of BNSF, aligning them around that operational excellence. You saw that we made progress, as Greg said in 2025. We continue to make progress in the first quarter of 2026. But we know that we have more work to be done to drive that operational excellence across all areas of our company.

[Greg Abel]

Thank you, Katie.

And then Adam, when I was discussing

your new role and thank you for taking on that role and, and as you. And, and also retaining your role at NetJets as the CEO there. So a lot on your plate and. And all of us here appreciate that. But it's early going. You've been in the role since December as the president of Consumer Products and then service and retailing. What, what are your observations as your,

your early observations across the 32 companies and how are you approaching that?

[Adam]

Yeah.

And talking to the different CEOs, I, if you give me just one second before I answer, I just want to make just one brief comment, really, to both Warren and Greg. I have been CEO of NetJets for the last 10 years, but I've been with Nuggets. This is my 30th year there. So only at Berkshire could you feel like the new kid on the block after being here for 30 years. But you know, Warren has taught us a lot, Charlie's taught us a lot, Greg's taught me a lot. One of the things that they've said over and over is, is that, hey, bad news takes the elevator and good news takes the stairs. And I really understood that many, many years ago. And until I became CEO, I found myself on the elevator a few times and what they never told me was what happens after you get on that elevator? And I just want to point out, as the CEO for the last 10 years, there's been many times I've had to make calls on things. We run a big business and I simply want to say that what happens after that is you have the most unconditional support. And I echo all the CEOs that are in this portfolio. So I just want to say thank you for that because it's not easy delivering sometimes good or bad news, but it's been phenomenal support as it relates to the actual. The other 31 CEOs in our bucket. I have to sort of start with conversation with NetJets because people have been asking me a lot in the last five months. So you're still CEO of NetJets, but how are you going to take on this other role? And I think the journey starts with, with the team at NetJets and many of them are here and they're, they're incredible. I spent a lot, a lot of time over the last ten plus years with them. I sat up in that stage in the arena in May of 2010 and it was a hard thing to hear, but it was the truth. And Warren talked about NetJets and stated that it was his toughest mistake that year. And but for the backing of Berkshire, that we would have been bankrupt. And I don't like repeating those words and probably shouldn't do it in front of an entire room, but it's an important pause because then you have two choices. What are you going to go do? And so the team that's sitting with me today and many people back home. I do think we have a wonderful company, as Warren talked about with Charlie in 2023. And I just want to say to them, thank you, because it's been a rough road to do that and we've accomplished a lot, which gets me in to answer your question. And, and I, you know, I'd be honest with you. So thank God I have netjets because I was able to fly around and see a lot of these companies. Unfortunately, all 31 companies are not based out of Columbus, Ohio. So I've been on our airplanes a lot. And if I'm honest, I was a little concerned about it. Many of the CEOs had reported directly to Warren. All of them reported to Berkshire. And then here comes this guy, you know, that they're now going to be working with. And I will tell you, one of the things that that struck me is how wise the CEOs are. They have the energy, intelligence, integrity that Warren always talks about. But I say wise because my concerns were quickly allayed when I started talking to them in the sense that they've been listening. I know many in this room don't know the names of those 31 other CEOs, but they know you and they've been listening. They absolutely understand the playbook that is the, the ownership manual. By the way, this is the. Almost today, the 30th anniversary, Warren wrote the owner's manual, and in that was sort of our business bible on what we needed to do. And I was really pleased. Every One of our CEOs understands that they've been living that, and that's going to make the interaction much easier for me. So I feel really good. I feel really good about the form of the CEOs that we have, and I know that they have ingrained in them the culture. Part of the culture certainly is the ownership thinking, but the stewardship that is talked about. We feel a massive and deep responsibility to carry on the stewardship and the legacy of Charlie and, and Warren and, and work really hard for Greg and his team. So I feel good about it.

[Greg Abel]

Great. Well, we're very fortunate to have Katie and Adam in these leadership roles again. It was a very purposeful. Have them on stage. We want them to have the opportunity to engage with our owners, our shareholders, and we really do look forward to the. The questions. So thank you for joining us on stage again. Thank you, Becky. Again, great to have you back. Thank you for that interview. And if you'd like to start. Thank you.

[Katie Farmer]

Okay.

[Becky Quick]

Thanks, Greg. This question comes from Chris Fried in Philadelphia, Pennsylvania who wants to know how has the current geopolitical situation in the Middle east impacted Berkshire's subsidiaries?

[Greg Abel]

Sure, I'll touch on it and then I'll, I'll make sure because it impacts really in a variety of ways all our businesses. But what I'm most proud of are our businesses. We operate these businesses for the long run just like we do for obviously for our shareholders. We take a long term approach there. There's not many days and I used to joke when I more had Adam's role, there wasn't a day I woke up where the phone wasn't ringing with good news. Yeah, that phone rang. You knew you're going to have a bit of a challenge and we have that portfolio but that's okay. We'd be talking and we always worked our way through it and we have a team that would lean in and we'd come through and it could be anything. And we never tried to use that as a reason we couldn't do something or get to the right place. And what I've seen associated with the, obviously the, the war in Iran and in the various conflicts in the Middle east is again a team that is very much taking the approach that that's the situation we're in, we can manage our business and we, we very much quickly move to what's the best solution for our customers, how can we deliver and continue to deliver what we've done to them and what's their expectations around that. And our teams are working incredibly hard to come up with, with solutions. I touched on lspi, the drag reduction agent on the pipeline company. They don't usually sell a lot of product into the Middle East. As far as moving it's more a domestic based product for Canada. In the US when you think of a drag reduction agent on pipelines literally being cargo planes of that, that chemical being moved in the Middle east to help free up supply and, and that is remove that, some of that constraint. So there's so many things that go on when they start trying to figure out how to solve the challenge. Now what I would say is it doesn't mean there's not immediate impacts to our businesses. If you think of companies in America, around the globe, petroleum is in natural gas matter is such a fundamental input to so many products. And the reality is if you think I touched on our chemical group, their, their input is generally a petroleum product and the output is the, the various products they produce obviously that, that are byproducts of that but their input costs have effectively doubled in a very short period of time. But again we'll manage through that. And that's the beauty of being part of Berkshire. They know first we'll take care of our customer, we'll find the right answer, we'll manage the challenges and the value creation will be there in the end. So there's some short term pressure on our chemical businesses. If you looked at their first quarter profits individually, they would be down because they're, or flat to down because they've got some challenges, for example, on the, the, on the input side. But they're delivering what the customer needs and that rebalances over a period of time where our prices will move up pursuant to our contracts, will be treated fairly in the end in that they'll reset and then man wind a little bit slower. But the point is unfortunate situation and we've got, you know, men of service and women of service over there and putting themselves at risk.

And, and that in itself is scary because a lot of our employees have family involved. But as far as running our businesses,

it's really heads down. We'll get through this and we'll keep operating everything for the long run. And again it includes how we'll operate our assets. We're not going to put the asset at risk to try to get to a short term outcome because of petroleum

prices higher or petrol, petroleum prices are higher.

It's very much continuing to take that, that long term perspective, Katie, obviously can impact demand and what's being brought in on the, on the coast. Are you seeing that or what else are your observations?

[Katie Farmer]

Yeah, it's interesting and Warren has said this in the past before, you know, the railroad is a really good reflection of what's happening in the industrial, industrial and the consumer economies because our loadings really cut across all the various commodities. You know, we touch agricultural products, we touch coal, the industrial commodities like cement and steel and aggregates. You know, certainly our intermodal business, which is such a big part of our business reflects what's going on with the consumer. And so we're seeing the impact from the conflict in the Middle east in a couple of different, different ways. First of all, I would say that if you look across our various commodities, it's created an opportunity for some of those commodities just because of the disruption in the supply chain. In addition to that, you know, we see commodities like aggregates and steel, things like that, that, that are, that are favorable and we're seeing an increase in those. But then some of the commodity areas that use energy in the manufacturing of those commodities are certainly being impacted by the increasing fuel prices. The largest segment of our business, as I mentioned, is intermodal. And so as fuel prices increase, our intermodal business becomes more competitive. And so we're seeing an increase there relative to what's happening in the Middle East. I would say in general though, as we think about it, if fuel prices stay too high for too long, it has an impact on consumer demand. And when that happens, that cuts across all of our businesses.

[Greg Abel]

And have you started to see that yet? That obviously when you think of, I touched on it being an input to many of our companies, but really globally it's an input to so many things. And as that price pressure, pressure moves up, obviously the, the demand side is challenged. Are you seeing that yet?

[Katie Farmer]

Yeah, we're seeing some, we are starting to see that impact some of the businesses. I would also say, Greg, as we talk to some of our large intermodal customers, what they are telling us, some of the big retailers are the customers are having to make choices now. So as fuel prices go up, they make choices about what they're buying. And so that's where I get back to if, if it is a prolonged higher fuel price environment, I do do believe that we will see that customer impact across our businesses.

[Greg Abel]

Thank you, Adam. Across your businesses. What, what are you seeing? What do you, what are you feeling?

[Adam]

Yeah, I mean certainly, you know, when you see, when you, when you see the increases that have occurred in the, in the instant spikes in some cases that occurred certainly on the consumer product side, on the real retail side,

[Warren Buffett]

it

[Adam]

has affected some of the demand on that side. I would, I would also tell you that we have also faced multiple times at NetJets with 100, you know, dollars a gallon or $100 a barrel pricing. We see those spikes, we see the demand. I haven't seen it on the net jet side. We went from really the last two years from about 5 to 540 a gallon, we're seeing spikes up 7 a gallon. I would tell you if I see that kind of sitting at seven and a quarter, 750 a gallon, then you'll see it start impacting even on the higher end side on the net Jed side. So we're feeling it. It's, you know, it's not the first time we've had to deal with this. You know, we're prepared to deal with those things and make adjustments where we need to. But it certainly is affecting, I would say some of the retail businesses and some of the consumer product businesses.

[Warren Buffett]

Great.

[Greg Abel]

Thank you, Adam. And thank you, Becky for the question. We'll now move to station five.

Good afternoon. Manjap Singh from Mountain House, California. Warren has spoken very highly of both you, Greg and Katie. So I'm grateful to have you both leading our company and I'd like to ask each of you you a question. Greg, as you know, the Berkshire system relies on decentralization. Each manager runs their own subsidiary. As CEO, which operating units do you think need more oversight? And how will you handle a manager who underperforms? And Katie, As Greg highlighted, BNSF's profitability lags its competitors. With eventual technology advancements in autonomous driving trucking costs will continue to drop. How will be NSF maintain its competitive advantage from competitors and new new technology?

Great. Thank you. So associated with the letter I wrote to all of you as owners, I

highlighted some important as I've touched on values.

One of them was our decentralized model.

I also touched on risk discipline, capital allocation. And when we think of our businesses, we have an exceptional group of leaders and businesses and yes, they do own their businesses. As Katie touched on it in her video, as Adam's alluded to it and talked about it, there's a great deal of ownership in each of our across each of our subsidiaries and that's absolutely how we'll continue to operate and see it as an extremely effective model. They're closest to their customers, they understand what needs to be done and if they think like an owner, we get very good outcomes across the group of companies. I would highlight though that with decentralized model we do not take responsibility. And I was one of those Iran bhe it's a great set of responsibilities or Berkshire Hathaway energy shouldn't be abbreviating.

Sorry, but when I ran it that

that autonomy meant you meant you embraced it and there was a great amount of accountability that came with it and sheer pride that you wanted to do things right. We've got a clear set of when we talk about integrity and how I started it, we have a lot of expectations and that's where both on the, on the integrity how they approach managing their business and servicing their customers. And I've said there's a lot of external factors we, we can, we can observe but our primary engagement is with their are they managing the risk and risk and foremost do they do they see themselves as that chief risk officer you've heard us discussed many times. Are they good allocators capital with the

capital they have there? Because even capital you have to Manage

your operating expense as well. I view everything, you know that, that when we're spending money on a, it may be a capital expenditure, it can be an operating expenditure. You're deploying our, our shareholders capital. Are we doing that well? And we focus on that. So that's part of that equation of allocation capital. And the reality is if, if we're seeing a situation where we're underperforming or we're, we're seeing some potentially poor decisions, that's where we engage and have a discussion. And usually it's relative. And I touched a bit on this

with Katie, it's relative to what we

see externally and just really trying to understand where our performance gaps are.

And, and then it quickly moves to,

and we have, we don't have the people at corporate to go in and quote, help. So it's not like we send in an army.

But there's generally some people within our subsidiaries or maybe someone we know that

could help them with that, with that performance gap.

Because we do treasure continuous improvement and strongly, as you've heard, believe in operational excellence. And there's, as I've said, there's room for us to get better and that's how we would approach the situations where we see the gap and need to close it. Katie, maybe you can probably touch on both.

[Katie Farmer]

Absolutely. So thank you for the question. And as I said, we absolutely know that it's critically important that we continue to drive an efficient operation, that we continue to have a competitive cost structure, and that we continue to close the gap with our competitor relative to our profitability. There's a couple of specific things that we're working on and it's really about operationalizing the improvement that we saw in 2025 into the first quarter of 2026 and making sure that we're really institutionalizing that. So the first thing that we really focused on in 2025 was we knew that we needed to improve our single car operational efficiency. And when I say single car unit operational efficiency, we run a couple of different networks. We run our intermodal network, we run our agricultural and our coal network, our bulk networks. And then the balance of it is what we call our car load network or our single car network. And that's where we, we have non unit train. It takes a lot of operational focus, it takes a lot of work effort and it consumes a lot of resources. And so anything you do to improve that single car network is good for all of your customers. It frees up resources, it creates capacity, it allows you to handle the same amount of volume, if not more, with fewer assets. And that translates through then to the improvement that you're seeing in the profitability. An example of that is in, in the first quarter of this year, we handled more volume than we did in the first quarter of last year, but we did it with 260 fewer locomotives. That translates into a more consistent service product for our customers. And it also translates into better financial results, which is what you saw in the first quarter of 2026. So we, we're spending a lot of time ensuring that we have operational excellence. Not in all, not in all, just all those other networks, but in the network that frees up resources and drives improvement and operational excellence for all of our customers. The second area, and you heard Greg talk about this earlier, was around our technological transformation. We really believe that in addition to driving that operational discipline that you saw in 2025 and into 2026, that working with the new BNSF Tech organization to drive that next step level of improvement. And so you, you saw units dwell in our terminals less time that translated through to the financial results that I talked about. You saw velocity improve as well. And so how do we leverage technology then to take the next step level improvement? So I'm excited about what we're doing there. We're literally attracting data scientists, operations research folks, and we're putting them alongside of our operators in our network operations center. We're looking at things like digital twins, which gives us the opportunity to model how we run the railroad before we actually run the railroad. We're looking at opportunities to do predictive ETAs for our customers, which allows our customers to have a better product. It allows us to turn the assets faster. And then last, what I would say is that we're just, it's good old fashioned going to work on attacking the largest structural cost buckets. We had a record for the first quarter in our fuel efficiency. That's the kind of thing we want to do because it makes us competitive with trucks. It is good for the environment and it's good for our financials. So those are the things we're doing to close the gap relative to profitability. Now your question about competing with trucks, I would say a couple of things with that. First of all, we have the largest intermodal franchise of all of the railroads. We have a unique relationship with J.B. hunt and we have been extremely successful in converting over the road freight. We've done more of that than anybody. So we know how to compete with trucks. But your question about technology is a good One, and I would say that we in the past have invested in a system called positive train control, which is a safety overlay that allows us to operate the railroad efficiently. As you know, we operate in a closed circuit. And so we have the ability to. Your point, ultimately to run the train with fewer people than we operate with today. And in fact, if you go way back in time, we used to operate the trains with five people on the train. Now we're down to two people on most of our trains. So the technology will continue, just like most industries will continue to evolve. And we're continuing to look at that as well. The last point I would say with that, though, is that we also have to be allowed to innovate. And so we need regulation that supports the ability for railroads to be able to compete with trucks. As you said, we know that there are trucks out there running today in our state. In Texas, along I45, we just. There was just a pilot with autonomous trucks. What we have to be able to do is to be able to compete with that and to be able to innovate. And so we're going to need regulation that allow the railroads to be able to do that. So that's how I think about competing, ensuring that we're closing the gap as well as maintaining our competitive advantage with trucks.

[Greg Abel]

Thank you, Katie.

Adam, on that. On that point and Katie's point, you

know, you came literally.

Adam had left for a very brief stint 10, 10 years ago and, and. And had a very senior role in. In NetJets and had been effectively been recruited to be a CEO of another business that was going public. And we were fortunate enough to convince

Adam to come back.

But he came back to a challenging situation. The asset was underperforming. We had billions of dollars of debt back to ourselves, to the parent company. But it was debt that had been incurred and some real challenges when you think about how we address underperformance and how do we get a business back on track? Maybe you just want to touch on that period of time and that bringing the business back and how you achieve that.

[Adam]

Yeah, well, one, I will tell you, you know, the. One of the. I came back on June 1st of 2015 and that Monday, Monday afternoon, and many of the team that's up here today, we got in a room and I asked a question about how many people really understand sort of the bookends of our business. NetJets is complicated. We're ad hoc, we're unscheduled. We fly to thousands of airports. Commercial airlines will fly to 50 to 100 airports. We fly to 150 countries around. So it's a very complicated business. And I asked a question to the team. How many people do you think really understand the bookends of our business? And I didn't like the answer. I won't tell you what the answer was, but it was too few, and it sort of started there. And what we did was we really said, you know, to build this culture the way we want it. If I understand what you're doing, you understand what I'm doing at deeper and wider levels, we're going to do good things together. So it sort of started on that Monday afternoon. And when we. We started building that back, I will tell you, it was also a reinforcement from, probably from Greg. I remember my first board meeting prep, and I was excited, and we were starting to kind of move, and. And I was talking about growth, and we're going to get this right. We're going to grow. And Greg pulled me aside in a very kind way, and he said, why don't you pay $1 back to Warren and work on getting your debt down? That was a teaching lesson. I took that to heart. I heard it clearly, and I actually already knew that. And so we just started really putting our blinders on. And we said, safety and service, safety and service. Warren bought net jets after becoming a customer in 1995, bought net jets in 1998, and he did a video for us that we still use. And he said, I want safety and I want service. And we've been really focused on making sure everybody safe stays in that alleyway. That, in large part, plus a lot of hard work, is why we were able to pay our debt back. We're able to pay cash back to Berkshire Hathaway and move our way, as I said in the video, out of the other comm. And be first in the service business. And I'm proud of that.

[Warren Buffett]

So great.

[Greg Abel]

Thank you, Adam. Thank you, Katie. Becky.

[Becky Quick]

Okay, this kind. This comes from Brian Simpkins in San Diego, California. The question is, has Berkshire Hathaway considered seeking any tariff relief or reimbursement programs for its wholly owned operating businesses exposed to import costs? And how significant is that impact across the portfolio?

[Greg Abel]

Let me. Let me start with the impact across our portfolio because it's.

It's very close to discussing the situation in the Middle east in that, yes, there were. There was the tariffs in each business may have fallen under a different tariff or what they were importing. And. And we'd gone through it once already in the. In the first term of the administrator in administration, and there were lessons learned there.

So we were both better.

Better prepared on how to manage through

it and had realigned a certain amount of our input. So, you know, that was valuable. The second thing was, it's.

As I described with the, with the conflict, it was heads down and we'll just manage ourselves through it. You know, listen there, there's some cost pressures here. We'll figure out how we're going to continue to serve the customer. We'll work through, on. On delivering what they need. And there has to be some reasonable expectations on the other side that we'd recover those tariffs from our, from. Through the. Either through a direct contract with them or through the product we're creating. And, and, and that was a good approach in that we just held our course and wanted to continue to service them. So they, yes, there is financial impacts, but our team did a really remarkable job of addressing it and really minimizing the impact any of our businesses as far as recovering it.

That would definitely be.

At our operating level. They would be making such a decision. But overall, right now, our perspective has been there's a lot to sort out when it comes to refunds, what we're eligible for. And, and so at this point in time, we're very much taking an approach that if it's appropriate, our teams will evaluate it. And, and again, it'll be a discussion with our customers, with a number of them. So it, it's. It's an operating subsidiary decision, but we're not naive to it in that we're encouraging them.

It's. There's a lot to be sorted out

at this moment in time, and we're not pursuing them. That doesn't mean we may not have a subsidiary. And I'll look to our, our team on stage here that may be pursuing one or seeking one. Katie, anything?

[Katie Farmer]

Not as far as the reimbursement, but I would say just as far as the impact of the tariffs and what we're seeing with our customers. You know, I would say that in early 2025, we saw several of our customers pulling forward shipments in advance, in advance of the tariffs. And, you know, we certainly saw our volumes ramp up at the beginning of 2025 because people were trying to get ahead of the implementation of the tariffs. So we did see, you know, an increase in volumes through early 2025 that really stabilized then in the back part of 2025 and then then into 2026. I would say that our customers have really adapted to the tariffs and adjusted to the tariffs. With that said, it does cause some uncertainty. And I think where we see that really showing up is, you know, it's very difficult for our customers from a planning perspective. And I think it's keeping some capital on the sidelines as far as investment in manufacturing facilities. And it's just really the uncertainty of the tariffs that. That really is what we're seeing reflected with our customers.

[Greg Abel]

Thank you, Adam.

[Adam]

Yeah, I mean, I would echo both those points. One, I would probably use, you know, Berkshire Hathaway Automotive, Jeff Rocker, who is an excellent, you know, CEO of that division. You know, his. The new and used sales are, you know, slightly down in Q1 of this year compared to last year. And part of that is this is sort of that same effect from the terrifying that occurred a year ago to. To today. I had to smile because we were collecting. Okay. It's just. It's changed every day, as we know, and you manage through that. And just understanding the tariff bouncing ball was, you know, a job in itself. But I. I had to smile because I was actually calling our. Our CEOs just to get their take on it. And the 32 companies in the portfolio, Consumer product services and retail, it's a stat that I love. They've actually been around, on average, 88 years. And only 0.5% of American businesses have been around more than 80 years. Our average in that sector from a founding standpoint is 88 years. And several of the five of the companies, specifically companies, were founded in the 1800s. And when I called those CEOs, they said, we've been dealing with tariffs for 100 years, you know, kind of. And so not being dismissive at all of tariffs. The point is, I look at the whole tariff conversation as you're always going to have a curveball. If I think of the CEOs, in the last, you know, seven, eight years, we've had to deal with a global pandemic, the highest inflation, 40 years, and now this thing, you know, the bouncing ball of tariffs. So the businesses have done an excellent job of managing through that. I wouldn't put it in the funding department of the things we have to deal with. But we're learning it, and I think we're in a pretty decent spot moving forward.

[Greg Abel]

So thank you, Adam. We'll move to station six.

[Adam]

Good afternoon. My name is Amir Rayhani from Vancouver, Canada. Thank you for hosting us and thanks to everyone at headquarters that makes this weekend possible. Berkshire's investments in the five Japanese trading houses was passive. Good business at good prices. Financed by GPN. Your Tokyo Marine deal is fundamentally different. A 10 year joint M and A and reinsurance partnership. That's a level of operational integration Berkshire has never done internationally. What does that look like in practice? And does it signal a broader shift toward active international partnerships under your leadership? And to put you on the spot, Greg, Canada versus USA in hockey. Who are you cheering for?

[Greg Abel]

Sorry, sorry.

Now I'm in trouble. Yeah. She did an exceptional job of discussing Tokyo Marine and I'll touch on it.

But what.

And I teed it up a bit in saying it is a strategic relationship

less than a financial transaction.

Yes, we like the two and a half percent investment in a Tokyo Marine and in that will be a long term

investment. It's the type of investment we put with our other five investments in Japan.

We really think of those as forever because it goes beyond the investment and it's very much around the relationships we

want to build there. And you'll continue to see that as

you'd expanded on the underwriting opportunity, that we do jointly participate in their risk and rewards associated with effectively also 2

1/2% of their book there now. And that's again part of the financial transaction.

But there's also a great deal of faith there. We, as Ajit said, and really Ajit says, and I take his word for that, but it's, you know, it's an

exceptional company and their performance has been remarkable.

So we're thrilled to have them. And then the third thing that was touched on was the partnership highlighted a variety of things, how we would like

the relationship to develop and that's not defined yet.

So we'll continue to let that take its proper form. They're the type of partner that has the same culture, same values as us. So there's little question it's going to be exceptional for many years to come. But as far as pursuing an absolute acquisition in insurance or something like that, that'll evolve with time.

And that would be obviously the discussions

as Ajit and the senior team at

Tokyo Marine would be having.

And if such an opportunity materializes, we'd be thrilled with it. Now to the really tough question. Canada versus U.S. in hockey. I, I did find a way and it's, it can cause a lot of angst in my own family. So I remember waking up that morning and Canada was playing the, the men. But I'd already decided a little bit earlier that when it came to The Canadian men versus US men, Connor McDavid plays for Edmonton. And therefore I was in a cheer because being from Edmonton. I would, I would cheer for the Canadian men's team and I've always followed the US Women and I love what a program the US Hockey and I love USA Hockey and how they approach the coaching and the, and the development of the youth. And I think they've done a great job there. So I chose to cheer for the US Women and it was the, the perfect outcome for me. So little selfish in finding that type of outcome.

[Katie Farmer]

I will say. Greg, Greg and I had an Oilers stars bet last year.

[Greg Abel]

Yes, true.

[Katie Farmer]

And we the losing person had to wear the jersey of the other and I now own Oilers gear.

[Greg Abel]

Yeah. Katie owns some Oilers jersey and unfortunately this year neither of us they're both on the sidelines very quickly. But thank you for that question. Becky.

[Becky Quick]

This question comes from a shareholder who didn't want to be identified, but it's a variation of a question that I got from several shareholders. Is there any future circumstance that you could envision Berkshire divesting businesses or being broken up? If so, what are those circumstances? The shareholder also writes, note, I don't want this to happen, but it's a commonly discussed it's commonly discussed among followers of the company.

[Greg Abel]

Yes.

So the so when we think of the question, and I think it's a good one because we've always highlighted there's

certain circumstances that we may not be the best owner of a business we've touched on if there's labor issues that we cannot resolve. I would take it to the point. Then further in my letter, I touched on if there's reputational risks that we're not willing to, to ever have our owners or shareholders or Berkshire experience and that we have to maybe the business has evolved, the customers have evolved. But if we're, if there's that type of situation, then that company does not belong in the Berkshire family. And it may be a fine business that can be owned by someone else, but it may mean we don't own it. I would then take it a little bit further. I touched on a couple things or one other thing before I jump to that would be we've often talked that if we have a business that is unsustainable and, and no longer generating operating cash for our shareholders, we have to make some serious decisions around that. If there's someone else who could operate it and make it be more successful, both for the customer and for our employees, then we have to consider that otherwise that business is unfortunately in a place where we can't just fund it and experience losses. We would wind up it down over a period of time. But we'd look for a better solution for our customers, employees. So that's always been the case. Well that, that at least from my perspective has always been the case and how we'll continue to do it. I would say we're taking it, we take the, the obligation and making sure our capital is properly deployed obviously very seriously. I touched on the regulatory compacted energy and that that has to, to exist and we have to be, if we have capital deployed there, we have to get a fair return. We have a, a situation where we've actually announced we're selling a portion of Pacific Corp. Our, our Washington state utility. And, and that's really a function of the fact that we have a multi state process. In Pacific Corp. There's six different states and each, each customer is impacted in different ways. And I've already said there's, we very much focus on what's the needs of our, each state and how can we best service them. And unfortunately we are in a situation in Washington where they clearly had policy that they wanted from Pacific Corp. And it was having a significant impact on the costs of our other states. And as much as we would have liked to see more what we call a multi state compact, that is how do they balance all that? It wasn't occurring and our other states were bearing costs that they felt were not theirs that were being imposed by another state. So we consciously said this isn't working for the six states and the one state who had very specific policies and wanted them implemented. We chose to exit. We found a very good purchaser who very much supported and, and could implement what was required at that state. So there we, there we have evolved and it's a situation where it just didn't make make sense for Berkshire to be an owner of that asset or our owners to be an owner of that asset. And it'll be I believe, a better outcome for the state and for their customers. So there are those situations where we would, we would divest and we will always approach things that when we buy something it's forever. When we acquire a utility, we tell the regulators it's forever. But it has to be a relationship that works and if it's broken, we'll find a better path both for the company, the employees, customers and obviously for Berkshire.

[Becky Quick]

Yeah, Greg, there's a second part of that question though that gets at least is there, is there a point where some of the parts or something, is there a point where it doesn't make sense for Berkshire to be a conglomerate where you would break up the company?

[Greg Abel]

Yeah.

So to the second part of the question. Absolutely not. We. We. I touched on an early we. We are a conglomerate, but we are an efficient conglomerate. We, we don't have layers of management. We don't have a bunch of committees telling our businesses how to run, how they're going to

manage their customer relationships.

We try to the odd time create frameworks so there's value shared across the businesses so they're aware of what our other businesses are doing and technologies. That's one of them. We like our framework now. We think it's, it's become, it's very effective across three of our businesses.

So of course we want them to understand it.

But we don't create layers. I remember when Adam took on the role, I nicely said, you know, there'll be no corporate group supporting you either in Omaha or amongst your own team. He's got folks in NetJets and they're always step up and take more responsibility, including when I was in that role

or in the vice chairman role.

But the one thing we don't do is create layers of bureaucracy or other

decision trees around it.

And I think so many conglomerates end up with layers and layers of costs that don't add value

to the overall corporation.

I'm, I'm even careful when I talk about our metals group and our chemicals group because, because they're a group in, in call it maybe in my vision, I. E. They, I, I see similar opportunities. I want them to work together but they don't have a corporate group on top of them or anybody directing them on what to do. They find ways to work together because they have a lot of the can have the same challenges, can have the same customers. Customers. So we see our conglomerate structure working without the bureaucracy and bloated costs. We see a great opportunity to continue to move capital across those different groups in a very tax efficient way. Other people can't say I want to move capital. BNSF's great example. Yes, they have a strong operating results and they generate, they're in a cycle in their, their business cycle right now where there's certain amount of capital we have to deploy into it. But we also receive substantial dividends from BNSF on an annual basis. We can take that capital and decide is it needed in a different operating business or do we see opportunities in equities. And if we don't see those opportunities, we're happy to not happy.

But we understand the logical home right

now is us treasuries. We think that's A good asset. We prefer to see that deployed in a different fashion. Yes, when the opportunity presents itself, but it allows us to really move that capital across the group. So I actually, the answer to the conglomerate is yes, we understand where one, we see it operates very effectively, and we do not see ourselves divesting of subsidiaries for that reason or ever breaking off a group.

[Warren Buffett]

Thank you.

[Greg Abel]

Okay. Station, station seven.

[Bori Wang]

Hi, Greg. Hi, Greg, Katie and Adam. My name is Bori Wang. I'm here from Chengdu, China, on behalf of myself and my investment partner, Xu Xiyi. Thank you very much for this opportunity. And congratulations, Greg, on surviving your first year as CEO.

[Greg Abel]

Thank you.

[Bori Wang]

I'm sure the sea feels a bit warmer than it used to be. As you lead Berkshire into this new chapter. What would you say is the most significant evolution in your personal framework for assessing cash flow, certainty and margin of safety compared to Warren's? And specifically, are you more inclined towards technology companies that exhibits the same robust cash flows? Thank you for continuing the legacy of Mr. Warren Buffett and Charlie, Mr. Charlie Munger.

[Greg Abel]

Thank you. So I, I think I'll start with the important part of that question. I mean, as far as how, how Warren thought about it, how Berkshire thought around approaching investments, quote, our margin of safety around investments and how we, how we approach it. We're absolutely aligned there. And I, and, and that starts with our culture and values and how we've approached everything over the years. So if I go back to looking at opportunities and energy in it may have been an acquisition or we're deploying significant capital, it quickly went to, yes, we understood the opportunity, but Warren and I'd want to have this conversation, where's the risk? And do we really understand the risk associated with this? And I have a really great example is that we were acquiring NV Energy in the had the opportunity, acquire it. And Warren was actually coming back from China and had been over there and I was waiting for him to arrive and land in Seattle and give him an update that we had this potential opportunity. And I very much knew the, the, the opportunity and what the, the value proposition was. I clearly had three significant risks in my mind that was anxious to discuss with Warren. And in the in Warren landed and I had a short presentation, sent him asking him to just give me a call. It was literally one page, but just to really trigger it, can we have this conversation? And the immediate conversation we had was, yeah, the economics, you know, you couldn't agree more. Understood them, went right to the biggest risk. And I was just getting ready to walk him through the two or three risks I'd seen and want to make sure we understood it and we're comfortable and wanted his input. And the risk was fundamentally rooftop solar. And how would it disrupt that business and disrupt our customer? We discussed it, we understood it was a challenge. I remember saying Warren, well that's part of the reason I'm sure we have this opportunity to acquire this public company that there is certain amount of risk in the public and the board and the management team have decided that they, they didn't see the same opportunity we did. But Warren went right to it. It was all around the risk. And that risk did surface 12 months later, 18 months. We managed our way through it. Our team did a great job. But so I don't see there being incremental margins or we think of risk differently. We think of them as in the Berkshire mindset that the, the we're going to understand the economic prospects of this opportunity and as I said, we really go to that 10 year window potentially and say what's the business look like 10 years from now? And that and is there enough safety margin 10 years from now? Is, is what we see it the outcome? Do we see an outcome? And if we don't understand what that looks like 10 years from now, I know Warren would, would say this, I would say it, then we don't do it. There's no safety margin. Or maybe we can adjust some numbers or there'll be synergies or something of that. Like we have to have a vision of what that's going to feel like and look like. And that really is the, the how we approach it now touching on technology companies, we're not going to ever say geez, this is a specific sector for us or we need to be in it. If there's something in the technology sector or in that group of companies and we understand one of those companies to understand again what their opportunities are and what we view as the economic prospects for it and we have an understanding of what those risks are that doesn't preclude us just because it's in a technology sector or that. But it would start with back to the fundamentals of do we understand it? Do we under both the opportunities and the risks. And, and then is it, and then is it fairly valued relative to that. And that's all. That's always going to be the approach. So thank you for your excellent question. Now Becky, if this is okay, we're going to. And, and so please pick your toughest question. But we're, we're beyond One o' clock. Now this will be our last question for today. So we look forward to it and, and then I'll have some conclusionary thoughts and comments. But thank you, Becky.

[Becky Quick]

This question comes from Joseph Matias and he said Warren had Charlie's partnership for most of his tenure as CEO which naturally reduced the risk of subpar investment decisions. Who will serve as the Charlie for Greg?

[Greg Abel]

And they're, they're a reason why they're in the rafters together. That was an incredible partnership and, and one that you know, you, you can't replicate. But what, what I would start with is that very fortunate to still have Warren as our, our chairman and, and that's very important and it's, and it makes for an excellent transition. Have an exceptional board of directors that I'm comfortable reaching out to any of them individually depending on the circumstances and either the risk we're dealing with or an opportunity that may be present in any of our businesses or one that may be coming our way. So we're fortunate to have that exceptional group in place and then it really comes back to our team that's in place. And I said this when I was answering to Warren from Omaha that we want Berkshire to endure and that means yes, I want to lead Berkshire and I'll be a strong leader. I strongly believe that and I'll take Berkshire for it. But it will be as you always need a single leader and I think we strongly understand that. But you surround yourself with great people and they're already here. I've been fortunate on the non insurance operation to operate with the, with Adams 32 and the 18 that I still get to interact with a lot. Those 50, including Adam and Katie obviously have an exceptional working relationship with Ajit and fortunate with that and would seek counsel regularly. Even even as vice chairmans we would constantly have a conversation around he may be making an insurance decision or I was making a decision around one of our non operating businesses and the first thing we'd cross check is how does it impact your group. So have an amazing relationship and someone

I immensely value the input.

And then across our CEOs we're so fortunate to have a great group that I would reach out to any of them on a specific circumstance and ask them for their input and I generally know where they've dealt with a challenge or a significant opportunity and I'd be the first to seek it out and say let's talk about it and figure out our path forward. And it may be that it was someone on their team that really dealt with it, and then I'd want to be talking to their team. So, fortunately, because of Berkshire and the way we're created, again, it is a unique structure, but we have an immense amount of resources around us. And then we have our team in Omaha who has supported Warren for all those years. They're remarkable, workable folks. There's, there's not a lot of them, but they are good and they're, and they're exceptional. And we're fortunate to have them as

part of the team.

So it will be such that Berkshire endures and will endure as a, as a team, but clearly with leadership. So thank you, Becky, that last question. Thank you.