Berkshire Hathaway 2025 Q3 Financial Summary (Ending September 30)
This summary highlights Berkshire’s strategic pivot toward extreme liquidity, record-breaking cash reserves, and selective industrial acquisition.
1. Financial and Capital Allocation Highlights
- Net Income and Investment Gains: Net income attributable to shareholders for Q3 2025 was 30.8 billion dollars, up from 26.25 billion dollars in the prior year. This was primarily driven by approximately 206 billion dollars in unrealized gains within the equity investment portfolio. The company reiterates that short-term fluctuations in investment gains are not indicative of core operating performance.
- Record Cash Reserves: As of September 30, 2025, cash, cash equivalents, and Treasury Bills held by insurance and other businesses (net of unsettled purchases) reached 354.3 billion dollars.
- Zero Share Repurchases: Despite the massive cash pile, Berkshire did not conduct any share repurchases during the first nine months of 2025. This suggests management believes the current stock price does not sit below its conservatively estimated intrinsic value.
- Major Acquisition (OxyChem): Berkshire announced an agreement in October 2025 to acquire Occidental Petroleum’s chemical division (OxyChem) for 9.7 billion dollars in cash. The transaction is expected to close in Q4 2025.
2. Business Segment Performance
- Insurance Operations (Strong Growth):
- Underwriting Profit Surge: After-tax underwriting profit reached 2.37 billion dollars in Q3, significantly higher than the 750 million dollars recorded last year. This resulted from lower catastrophe losses and downward adjustments to prior years’ loss reserves.
- GEICO: Delivered a strong performance with 1.77 billion dollars in pre-tax underwriting profit. Despite rising claim severities, margins improved due to higher average premiums per policy, lower claim frequencies, and reduced catastrophe losses.
- Investment Income Decline: After-tax insurance investment income fell by approximately 13.2%, mainly due to declining short-term interest rates and capital distributions from subsidiaries to the parent company.
- Railroad (BNSF) (Steady Growth):
- After-tax earnings grew 4.8% to 1.45 billion dollars. This was supported by improved core pricing, operational efficiency gains, and a lower effective tax rate, which offset a decline in fuel surcharge revenue.
- Energy (BHE) (Facing Challenges):
- Earnings fell 8.6% in Q3 to 1.49 billion dollars. Weakness was seen in US utilities and natural gas pipeline operations, alongside increased interest expenses.
- Policy Risk: The report explicitly mentions the “One Big Beautiful Bill Act (OBBBA)” passed in July 2025. This act accelerates the phase-out of clean electricity tax credits and establishes new procurement requirements, creating uncertainty for future renewable energy projects.
- Pilot (Travel Centers) (Significant Decline):
- Pre-tax earnings plummeted 107.8%, resulting in a loss of 17 million dollars. The downturn was caused by lower wholesale fuel and shop margins, decreased fuel volumes, and rising operating expenses.
3. Legal Litigation and Risks
- PacifiCorp Wildfire Litigation: This remains the most significant legal challenge. Regarding wildfires from 2020 and later (such as the James case), cumulative estimated probable losses as of September 30, 2025, were approximately 2.85 billion dollars (before insurance recoveries).
- HomeServices Antitrust Case: The class-action settlement regarding real estate commissions was approved by the court in 2024. Payments are currently being made according to the agreement.
Here is the financial report summary for Berkshire Hathaway’s 2025 Third Quarter, based on the Form 10-Q filing.
1. Consolidated Income Statement
(USD in millions)
| Item | 2025 Q3 Amount | % of Total Revenue | 2024 Q3 Amount | YoY % |
| Total Revenues | $94,972 | 100.0% | $92,995 | +2.1% |
| Costs and Expenses | $79,136 | 83.3% | $81,223 | -2.6% |
| Insurance losses and loss adjustment expenses | 13,735 | 14.5% | 15,163 | -9.4% |
| Cost of sales and services | 40,875 | 43.0% | 39,579 | +3.3% |
| Selling, general and administrative expenses | 6,285 | 6.6% | 8,219 | -23.5% |
| Interest expense | 1,261 | 1.3% | 1,214 | +3.9% |
| Operating Earnings^1 | $15,836 | 16.7% | $11,772 | +34.5% |
| Investment Gains/Losses | $21,939 | N/A^2 | $20,514 | +6.9% |
| Earnings Before Income Taxes | $38,105 | N/A | $32,508 | +17.2% |
| Income tax expense | 7,241 | 7.6% | 6,028 | +20.1% |
| Net Earnings Attributable to Shareholders | $30,796 | 32.4% | $26,251 | +17.3% |
2. Revenue by Segment
(USD in millions)
This table is based on the Business Segment Data from Note 24, providing a clearer view of individual unit performance.
| Segment | 2025 Q3 Revenue | % of Total Revenue | 2024 Q3 Revenue | YoY % | Primary Drivers |
| Insurance | $26,181 | 27.6% | $26,664 | -1.8% | Higher premiums were offset by lower investment income due to interest rate drops and capital distributions. |
| Manufacturing | $20,047 | 21.1% | $19,675 | +1.9% | Growth in aerospace and industrial products offset declines in the consumer products segment. |
| McLane | $13,191 | 13.9% | $12,723 | +3.7% | Driven by price increases and higher volumes in the food service business. |
| Pilot | $10,882 | 11.5% | $10,630 | +2.4% | Retail fuel sales increased this quarter, despite lower wholesale volumes. |
| Energy (BHE) | $7,304 | 7.7% | $7,335 | -0.4% | Fluctuations in real estate brokerage and natural gas pipeline operations. |
| Railroad (BNSF) | $6,039 | 6.4% | $5,940 | +1.7% | Increased consumer product volumes and improved core pricing power. |
| Service | $5,752 | 6.1% | $5,130 | +12.1% | Strong revenue growth from NetJets and IPS (Engineering/Construction). |
| Retailing | $4,841 | 5.1% | $4,712 | +2.7% | Growth in automotive (BHA) offset weakness in home furnishings retail. |
| Corp/Eliminations | 735 | 0.8% | 186 | N/A | Internal eliminations and unallocated items. |
| Total | $94,972 | 100.0% | $92,995 | +2.1% |
Summary Analysis
- Revenue Growth: Overall revenue increased slightly by 2.1% year-over-year. The primary growth engines were Service (+12.1%), McLane (+3.7%), and Manufacturing (+1.9%).
- Insurance Segment: While it remains the largest revenue contributor (27.6%), revenue dipped 1.8% due to lower investment income. However, profitability surged significantly due to lower catastrophe losses.
- Pilot Segment: Despite a cumulative revenue decline over the first nine months (-13.0%), Q3 saw a rebound of 2.4%. It is worth noting, however, that profitability turned into a loss due to margin compression and rising expenses.
- Impact of Investment Gains: The 17.3% increase in net earnings was largely supported by 21.9 billion dollars in unrealized investment gains.
This Consolidated Balance Sheet is based on Berkshire Hathaway’s September 30, 2025 (Q3) Form 10-Q report, compared against December 31, 2024 (Prior Year-End).
Berkshire Hathaway Consolidated Balance Sheets
(USD in millions)
| Item | 2025/9/30 Amount | % of Total Assets | 2024/12/31 Amount | Change % |
| ASSETS | ||||
| Insurance and Other | ||||
| Cash and cash equivalents | $72,156 | 5.9% | $44,333 | +62.8% |
| Short-term U.S. Treasury Bills | $305,367 | 24.9% | $286,472 | +6.6% |
| Investments in equity securities | $283,241 | 23.1% | $271,588 | +4.3% |
| Equity method investments | $25,524 | 2.1% | $31,134 | -18.0% |
| Receivables and Loans | $78,265 | 6.4% | $71,685 | +9.2% |
| Inventories | $25,319 | 2.1% | $24,008 | +5.5% |
| Property, plant and equipment (PP&E) | $30,736 | 2.5% | $30,071 | +2.2% |
| Goodwill & Intangibles | $91,473 | 7.5% | $91,498 | 0.0% |
| Other assets | $70,624 | 5.8% | $66,983 | +5.4% |
| Railroad, Utilities and Energy | ||||
| Cash and cash equivalents | $4,150 | 0.3% | $3,396 | +22.2% |
| Property, plant and equipment (PP&E) | $181,579 | 14.8% | $175,030 | +3.7% |
| Goodwill | $27,107 | 2.2% | $27,020 | +0.3% |
| Other assets | $30,422 | 2.5% | $30,663 | -0.8% |
| Total Assets | $1,225,963 | 100.0% | $1,153,881 | +6.2% |
| LIABILITIES | ||||
| Insurance and Other | ||||
| Unpaid losses & loss adj expenses | $151,144 | 12.3% | $147,594 | +2.4% |
| Unearned premiums | $33,483 | 2.7% | $30,808 | +8.7% |
| Payable for purchases of Treasuries | $23,241 | 1.9% | $12,769 | +82.0% |
| Notes payable and other borrowings | $45,617 | 3.7% | $44,885 | +1.6% |
| Other liabilities | $77,246 | 6.3% | $75,164 | +2.8% |
| Railroad, Utilities and Energy | ||||
| Notes payable and other borrowings | $81,626 | 6.7% | $79,877 | +2.2% |
| Other liabilities | $25,777 | 2.1% | $25,259 | +2.1% |
| Income taxes (deferred) | $87,388 | 7.1% | $85,870 | +1.8% |
| Total Liabilities | $525,522 | 42.9% | $502,226 | +4.6% |
| SHAREHOLDERS’ EQUITY | ||||
| Common stock & Capital in excess | $35,630 | 2.9% | $35,673 | -0.1% |
| Accumulated OCI | $(2,523) | -0.2% | $(3,584) | N/A |
| Retained earnings | $743,987 | 60.7% | $696,218 | +6.9% |
| Treasury stock | $(78,939) | -6.4% | $(78,939) | 0.0% |
| Noncontrolling interests | $2,286 | 0.2% | $2,287 | 0.0% |
| Total Shareholders’ Equity | $700,441 | 57.1% | $651,655 | +7.5% |
| Total Liab. and Equity | $1,225,963 | 100.0% | $1,153,881 | +6.2% |
Financial Status Analysis
- Extremely Conservative Asset Allocation:
- Massive Cash Pile: As of late September 2025, the combined total of “Cash and cash equivalents” and “Short-term Treasury Bills” held by the insurance business reached 377.5 billion dollars ($72.1B + $305.3B), representing 30.8% of total assets. This is an increase of roughly 46.7 billion dollars compared to the end of 2024. This reflects Warren Buffett’s decision to accumulate liquidity in the absence of attractive large-scale investment opportunities.
- Payable for Treasury Purchases: A liability of 23.2 billion dollars appeared for unsettled Treasury purchases at the end of the quarter, confirming the high volume of ongoing short-term government debt trading.
- Significant Drop in Equity Method Investments:
- Equity method investments fell from 31.1 billion dollars to 25.5 billion dollars (-18.0%). This decline was primarily driven by an other-than-temporary impairment loss of approximately 5 billion dollars recognized on the investment in Kraft Heinz during the second quarter of 2025.
- Continuous Investment in Infrastructure:
- The combined Property, Plant, and Equipment (PP&E) for the BNSF Railroad and BHE Energy segments reached 181.5 billion dollars, or 14.8% of total assets. Despite legal challenges such as wildfire litigation, Berkshire continues to commit capital to these asset-heavy businesses.
- Steady Growth in Shareholders’ Equity:
- Retained earnings grew by 6.9% (approx. 47.7 billion dollars), serving as the main driver for the increase in equity.
- Treasury Stock remained unchanged at 78.939 billion dollars, confirming that no share repurchases were made during the first nine months of 2025.
Based on Berkshire Hathaway’s 2025 Q3 Form 10-Q report, the only significant new acquisition disclosed is the chemical division of Occidental Petroleum, known as OxyChem.
Below is a detailed breakdown of the transaction:
1. Key Transaction Data
- Acquisition Target: OxyChem, the chemical business segment of Occidental Petroleum.
- Transaction Value: 9.7 billion dollars.
- Payment Method: Fully paid in cash. Given that Berkshire held over 350 billion dollars in cash and Treasury bills at the end of Q3, this transaction represents only a small fraction of its total liquidity.
- Timeline: The agreement was announced on October 2, 2025 (shortly after the close of Q3). The deal is expected to close in the fourth quarter of 2025, pending regulatory approvals.
2. Business Profile and Asset Nature
- Industry: OxyChem is a global manufacturer of commodity chemicals.
- Applications: Its products are used in a wide range of sectors, including water treatment, pharmaceuticals, healthcare, and commercial/residential development.
- Asset Characteristics: This business typically generates steady cash flows, aligning with Warren Buffett’s strategy of investing in mature traditional industries with tangible physical assets.
3. Key Terms: Risk Mitigation
- Retained Environmental Liabilities: A detail highly favorable to Berkshire is that Occidental Petroleum will retain all legacy environmental liabilities associated with OxyChem.
- Strategic Interpretation: The chemical industry often carries long-term risks related to environmental cleanup and litigation from past operations. By securing this clause, Berkshire is acquiring the productive “assets and operations” while leaving the potential “toxic liabilities” with the seller. This reflects Berkshire’s characteristically disciplined approach to risk management.
4. Strategic Context
- Deepening the Partnership: Berkshire is already the largest shareholder of Occidental Petroleum. As of September 30, 2025, Berkshire held approximately 26.9% of Occidental’s common stock, along with preferred stock and warrants.
- Capital Allocation: In an environment where large-scale public acquisitions are scarce and Berkshire’s own stock is not deemed undervalued for buybacks, management has chosen to deploy cash into high-quality physical assets carved out from a familiar partner.
Based on Berkshire Hathaway’s 2025 Third Quarter (ending September 30) Form 10-Q filing, the company’s legal risks are primarily concentrated in the energy sector (PacifiCorp wildfire litigation) and the real estate brokerage sector (HomeServices antitrust litigation). Additionally, there is a bankruptcy settlement involving the reinsurance segment.
1. PacifiCorp Wildfire Litigation (Energy Segment)
This represents the most substantial financial legal challenge currently facing Berkshire, involving allegations that equipment owned by its subsidiary, PacifiCorp, ignited wildfires in Oregon and California.
- Case Background: The litigation primarily concerns severe wildfires during Labor Day weekend in 2020 (such as the Archie Creek, Slater, and Beachie Creek fires) and the 2022 McKinney Fire. Plaintiffs allege that PacifiCorp’s equipment caused the fires due to company negligence.
- Claims Amount: In pending litigation, plaintiffs are seeking total damages of approximately 550 billion dollars (excluding punitive or double/treble damages). Approximately 520 billion dollars of this arises from the massive complaints in the James class-action lawsuit.
- James Class Action (The Key Battlefield):
- Verdict Status: In June 2023, a jury found PacifiCorp liable for “gross negligence” and “reckless conduct,” awarding punitive damages. Subsequent damages-phase trials have resulted in cumulative net judgments of approximately 497 million dollars.
- Appeals Strategy: PacifiCorp is appealing to the Oregon Court of Appeals, arguing that combining different fire victims into a single class action was improper and that Oregon law should not permit such non-economic damages. The company cites an Oregon Department of Forestry (ODF) report stating that the Santiam Canyon fire was caused by embers from a different source (Beachie Creek Fire), not PacifiCorp equipment.
- Future Risks: The court plans to schedule hundreds of individual trials between 2026 and 2028. PacifiCorp argues this will paralyze the court system and is seeking a stay of proceedings.
- Government Action: The US Department of Justice sued PacifiCorp in December 2024, seeking over 900 million dollars for fire-related costs and damages.
- Financial Impact: As of September 30, 2025, PacifiCorp has recognized cumulative estimated probable losses of 2.85 billion dollars.
- Approximately 14 billion dollars has already been paid out in settlements.
- Approximately 14.5 billion dollars remains as an unpaid liability on the balance sheet.
- The company warns that final losses could be significantly higher than current estimates.
2. HomeServices Antitrust Litigation (Real Estate Segment)
This case involves the structure of real estate brokerage commissions, alleging that HomeServices conspired with other defendants to inflate commission rates.
- Case Background (Burnett Case): Plaintiffs alleged that real estate firms used Multiple Listing Service (MLS) rules to force sellers to pay buyer-broker commissions, artificially inflating home prices. In October 2023, a jury ruled for the plaintiffs, awarding 1.8 billion dollars in damages (which could be trebled to over 5 billion dollars under antitrust law).
- Nationwide Settlement: To mitigate risk, HomeServices reached a nationwide class-action settlement in April 2024.
- Settlement Amount: HomeServices agreed to pay 250 million dollars over four years. As of September 30, 2025, 67 million dollars has been paid into an escrow account.
- Current Status: The settlement was approved by the District Court and entered final judgment in January 2025. The case is currently in the appeals phase regarding objections to settlement terms or attorney fees. If the settlement is not ultimately confirmed by the appellate court, HomeServices will continue to appeal the original massive judgment.
3. NICO Bankruptcy Settlement (Reinsurance Segment)
- Content: National Indemnity Company (NICO), a Berkshire subsidiary, reached an agreement in September 2024 to pay 535 million dollars to resolve claims related to certain non-insurance affiliates that had filed for bankruptcy.
- Financial Impact: This expense was primarily recognized in the Q3 2024 financial statements (a pre-tax charge of 490 million dollars). The court approval process is currently ongoing.
Summary of Legal Strategy
Berkshire’s current legal approach can be summarized as follows:
- For Wildfires (PacifiCorp): A “litigate and negotiate” strategy. The company is aggressively appealing to overturn class-action certifications and reduce liability while simultaneously settling individual cases (14 billion dollars paid to date) to manage exposure.
- For Real Estate (HomeServices): A “risk containment” strategy. By agreeing to a 250 million dollars settlement, the company aims to eliminate the catastrophic risk of multi-billion dollar treble damages.