Berkshire Hathaway's Q2 2026 Earnings Report
All of the little (and big) details from Berkshire's latest 10-Q
Berkshire Hathaway CEO Greg Abel went to work in the second quarter.
He not only started putting the conglomerate’s record cash hoard to use, but also showed early proof that his managerial chops will pay dividends with the subsidiaries.
Abel often cites “operational excellence” as a mantra of sorts for his tenure as CEO. And, with only one or two notable exceptions, it seems like the message is taking root across the sprawling business empire he inherited.
All in all, Berkshire’s Q2 2026 performance makes for pretty happy reading.
Berkshire Hathaway closed the second quarter with $364.7 billion in cash.
That’s still a jaw-dropping number, but actually represents a 4% decline from the previous quarter. In fact, this snaps a four-year streak of quarter-over-quarter cash growth. (And, notably, this figure does not capture the $6.8 billion paid in cash for Taylor Morrison, since that deal did not officially close until late July.)
It does include, though, $4.5 billion of share repurchases. That comes in on the lower end of estimates, but there is good news for those of us hoping to see bigger buybacks. The pace of repurchases accelerated throughout the second quarter (even as the price paid per share increased) and carried over steadily into July.
According to my back-of-the-napkin math — which, let’s be honest, is shaky at even the best of times — Berkshire snapped up 4,553 more of its own Class A equivalents (perhaps $3.5 billion?) during the first four weeks of the new quarter alone.
Net seller no more.
For the first time in fourteen(!) quarters, Berkshire bought more stock ($23.5 billion) than it sold ($3.7 billion) in the second quarter. A decisive swing back toward offense after years of trimming its equity book.
Even if you set aside the $10 billion private placement with Alphabet — the one piece of the puzzle we already know about — Berkshire still would have ranked as a clear net buyer for the quarter as a whole. Thankfully, we don’t have to wait long for the full story: Berkshire’s 13-F should drop on Friday afternoon.
The conglomerate’s stock portfolio finished the quarter valued at $323.8 billion and remains every bit as concentrated as ever. The top five holdings — Apple, American Express, Alphabet, Coca-Cola, and Bank of America — now account for 66% of the entire portfolio, up five points from the previous quarter. No matter who is calling the shots, Berkshire has never been afraid to lean way into its highest-conviction ideas, rather than spreading capital thinly across dozens and dozens of names.
Operating earnings have long been Warren Buffett and Charlie Munger’s preferred metric for measuring Berkshire’s actual business performance.
It cuts through the noise of unrealized gains and losses to reveal what the subsidiaries did — or did not — accomplish in a given quarter. And Q2 2026 is a good example of why this distinction matters. Berkshire’s net earnings more than doubled to $25.7 billion, but that surge owes far more to the unrealized swings of its aforementioned massive stock portfolio than to underlying business performance. Berkshire calls these fluctuations “usually meaningless” and recommends that shareholders focus instead on operating earnings as the truest measure of performance.
In the second quarter, Berkshire reported $12.98 billion in operating earnings, good for a 16.3% gain. But, before moving on, there’s still the whole foreign currency issue to address. (FX swings, which the company doesn’t really control, can distort the picture of core business performance.) If you strip out these gyrations — removing this quarter’s $326 million “gain” and the $877 million “loss” in 2025 — the year-over-year operating earnings increase narrows to 5.2%. Which is still a solid result.
Insurance underwriting earnings declined 13.1%, though the blame for that lies squarely with GEICO. That being said, all three of Berkshire’s insurance segments remained profitable in the second quarter — with gains from BH Primary and BH Reinsurance Groups partially mitigating the GEICO slide.
The auto insurer’s pre-tax underwriting earnings tumbled 45.4% from $1.82 billion a year ago to $994 million this quarter. The deterioration came from both directions at once. Claims frequencies and severities increased on the loss side, while expenses jumped 27.3% on higher commissions and advertising spend as GEICO works to reignite policy growth. Even so, it still managed a very decent 91.2% combined ratio (and earned nearly a billion dollars) for the quarter.
BH Primary and BH Reinsurance both benefited from an absence of significant catastrophe events so far this year (unlike the SoCal wildfires in 2025). Each was also able to reduce its ultimate loss estimates for prior accident years’ claims — which is a jargon-y way of saying that Berkshire’s conservative and disciplined approach once again turned out to be more than enough to cover actual losses.
The new Tokio Marine strategic partnership is already making an impact. BH Reinsurance’s premiums written rose by $204 million in the second quarter, though that was entirely attributable to National Indemnity assuming $483 million of Tokio Marine’s non-life premiums over a ten-year term. If not for that, reinsurance property/casualty premiums would have declined by 5.6%.
Float now stands at roughly $177.5 billion, up $1.1 billion since year-end. And, since overall underwriting was profitable, the cost of that float is negative, meaning Berkshire gets paid to hold — and put to work — other people’s money.
BNSF Railway kept chugging right along.
The Berkshire-owned railroad’s revenue rose an impressive 14.6% in the second quarter, as it moved 6.5% more traffic (particularly consumer products and agricultural/energy) and average revenue per car/unit increased 7.6%. Unfortunately, due to fuel expenses, BNSF’s operating costs went one better and jumped 15.6%.
All told, BNSF’s net earnings increased 6.3% to $1.6 billion.
But there’s still a long way to go. BNSF’s operating ratio (65.4%) continues to trail Union Pacific’s (59.2%) by a pretty wide margin.
Berkshire Hathaway Energy earnings soared 26.9% up to $891 million.
This growth came primarily from U.S. utilities and natural gas pipelines, which each posted 30+% gains in net earnings. That more than offset any weakness in other energy businesses (in particular, Northern Powergrid) and the real estate brokerage.
No discussion of BHE would be complete without an update on PacifiCorp’s ongoing legal saga. The utility notched an important win at the Oregon Court of Appeals in April, when the wildfire litigation in the James case was remanded to the circuit court after judges determined the original jury had been given incorrect and prejudicial instructions. It was a welcome sigh of relief for the beleaguered subsidiary, but the story is far from finished. The James plaintiffs appealed to the Oregon Supreme Court which has agreed to hear oral arguments on November 3, 2026.
The enormous MSR (Manufacturing, Service and Retail) segment also delivered big numbers. Overall, net earnings increased 24.1% to $4.5 billion. And growth was strong across the board, with M’s pre-tax earnings up 26.8% and S&R up a similar 23.5%.
Industrial products fired on (almost) all cylinders. Precision Castparts notched $3.1 billion of revenue on higher aerospace and industrial gas turbine sales, as pre-tax earnings rocketed up 34.2%. Lubrizol had its earnings jump 23.4%. Marmon’s 4.9% revenue increase mostly came down to Acme Brick joining the crew earlier this year. IMC grew earnings an eye-popping 71%, though management warned that rising raw material costs might weigh on results in the back half of the year. OxyChem contributed $1.4 billion in revenue and $149 million in pre-tax earnings.
Building products told a more uneven story. Clayton Homes, the segment’s bellwether, posted 2.8% revenue growth to $3.4 billion, with home sales up 1.7% and financial services up 9.5% on higher loan balances and interest rates. But earnings slipped 3.5% to $468 million due to softer homebuilding profitability.
The other building products businesses recorded a 16.6% gain in pre-tax earnings, though that number flatters the underlying reality. Without this quarter’s one-time tariff refunds, earnings would have declined 8.8%.
Brooks and Jazwares paced consumer products with both revenue and earnings gains. Duracell also had higher earnings, but that was primarily due to domestic manufacturing tax credits — not business improvement. Sales declined at Fruit of the Loom and Forest River.
The service group racked up 20+% gains in both revenue and earnings. TTI, aviation services (NetJets and FlightSafety), and IPS all enjoyed double-digit revenue growth. The 10-Q did note that some of TTI’s sales may have been pulled forward due to worries about future price increases and supply chain issues.
McLane suffered declines in both revenue (-3.8%) and earnings (-1.7%).
At Berkshire Hathaway Automotive — which accounts for roughly 70% of the retailing group’s revenue — sales edged up 0.5% in the second quarter and pre-tax earnings an even better 5.1% on strong service contract operations. The rest of the retail businesses faced sluggish customer demand as earnings slipped 2.8%.
Pilot showed some much-appreciated signs of life with 143.7% higher earnings.
Thanks, Kevin, for a thorough analysis! You spent your weekend working hard! That was a big service to us, even though I spend some hours reading the report—but not with your excellent thoroughness! Thanks!