Warren Buffett has stepped down as chairman of Berkshire Hathaway, effective immediately, according to statements released by the company on Friday [1][2][3]. Buffett, who has led Berkshire since 1965, will become chairman emeritus and remain a member of the board of directors, continuing to offer his judgment and perspective [2][3]. His son, Howard Buffett, who has served as a Berkshire director since 1993, will take over as chairman of the board, a move described as part of a long-standing succession plan [1][2][3]. Greg Abel, who succeeded Buffett as CEO earlier this year, will continue in that role [1][2][3].
Buffett, now 96 years old, reflected on his tenure in a letter to shareholders, stating, "Father Time always wins. He has, however, been generous with me. He has given me the opportunity to see Berkshire reach a point where I am more confident than ever about what lies ahead" [1][2][3]. Abel praised Buffett's unparalleled impact on Berkshire and emphasized that the company's culture and values would remain central, with Howard Buffett as their guardian [1][3].
Under Buffett's leadership, Berkshire Hathaway achieved extraordinary returns, with its share price rising more than 5,500,000% since the 1960s, compared to a 39,000% return for the S&P 500 over the same period [2]. The company posted a 19.7% compounded annual return to shareholders, nearly double the S&P 500's return [3]. Berkshire has grown into a conglomerate with investments in railroads, insurance, and numerous household brands, and reported $44.5 billion in operating earnings last year with nearly 400,000 employees [3].
Market reaction to the news was negative, with Berkshire Hathaway's Class B shares (BRK.B) closing at $509.20, down $10.60 or 2.04%, and Class A shares (BRK.A) closing at $763,935.95, down $16,361.24 or 2.10% [1].
Buffett remained active in the company even after stepping down as CEO, attending the annual meeting in May and making significant investment decisions, including a recent $10 billion private stock purchase in Alphabet, now Berkshire's third largest holding behind Apple and American Express [2][3]. Buffett admitted he was late to invest in both Alphabet and Apple, but these investments have since become major components of Berkshire's portfolio [2][3].
Looking ahead, Buffett expressed confidence in Berkshire's future, and the company reiterated that its culture and values would be preserved under Howard Buffett's chairmanship [1][3].
CONCLUSION
Warren Buffett's departure as chairman marks the end of an era for Berkshire Hathaway, with his son Howard Buffett stepping in to safeguard the company's culture and values. The market reacted negatively to the leadership change, as reflected in the drop in Berkshire's share prices. Despite the transition, Buffett and company leaders expressed strong confidence in Berkshire's continued success and stability.