Berkshire Bought Companies and Its Own Stock. The Cash Pile Grew Anyway.
Nine months of acquisitions and doubled buybacks still left Berkshire with more cash than it started the year, because the operating businesses generate money faster than Greg Abel can deploy it.
Berkshire Hathaway's third quarter, reported Saturday, looked in the usual places like a soft one. Operating earnings, per the release, fell 5.8% to $12,705 million from $13,485 million a year earlier, and net earnings attributable to shareholders dropped about 28% to $22,112 million as investment gains shrank to $9,407 million from $17,311 million. But the numbers that describe what Berkshire is actually doing with its money point the other way. The company spent the year buying whole businesses and repurchasing its own shares at an accelerating pace, and still ended September with more cash and near-cash than it held at the start of 2026.
The arithmetic is the story. Acquisitions of businesses net of cash acquired ran $16,205 million across the first nine months, anchored by the OxyChem purchase completed January 2 for roughly $9.4 billion in cash and the Taylor Morrison Home deal struck May 31 at $72.50 per share, about $6.8 billion in aggregate and closed July 24. Buybacks added roughly $9.6 billion in the third quarter alone, more than double the $4.5 billion of Q2, and about $14.4 billion for the year so far. That is close to $30 billion of deployment in nine months. Yet the Form 10-Q shows cash and equivalents plus Treasury Bills of $377.4 billion at September 30, about $4.1 billion above the December 31 level. The arithmetic behind that is straightforward: net cash from operating activities ran $33,914 million over the same nine months, and the railroads, utilities, insurers, and factories that generate it keep refilling the tank faster than an active acquirer can drain it.
The equity desk went quiet
While the acquisition desk ran hot, the stock portfolio barely moved. Berkshire's nine-month cash flow statement shows $41,771 million of equity purchases against $30,572 million of sales, but nearly all of that buying came in the first half. In the third quarter Berkshire purchased roughly $2.4 billion of stocks and sold about $2.8 billion, making it a modest net seller after a heavy early-year run. The portfolio stood at $335,515 million in fair value at September 30, carried on a cost basis of $108,462 million, with the five largest holdings, Alphabet, American Express, Apple, Bank of America, and Coca-Cola, accounting for 65% of that value and Alphabet the largest position. A portfolio that concentrated and a quarter that passive means the near-term swings in reported net earnings, up or down, are mostly marks on a portfolio Abel is barely trading.
Insurance cooled while everything else grew
The operating decline traced almost entirely to insurance. Underwriting earnings fell to $1,352 million from $2,369 million a year earlier, and investment income slipped to $2,734 million from $3,181 million, even as float grew to roughly $178.5 billion, up about $2.1 billion since year-end. GEICO illustrates the squeeze: premiums earned were essentially flat at $11,405 million against $11,264 million, while losses and loss adjustment expenses climbed to $8,733 million from $8,047 million. Away from insurance, the picture reversed. BNSF earned $1,729 million versus $1,449 million, Berkshire Hathaway Energy $1,612 million versus $1,489 million, and manufacturing, service, and retailing $4,042 million versus $3,616 million, with OxyChem and Taylor Morrison now contributing from inside that segment. The conglomerate's newest pieces are already showing up where the growth is.
What the buyback says
Berkshire's repurchase program permits buybacks whenever the CEO, after consulting the Chairman, judges the price below intrinsic value as conservatively determined, with no maximum amount specified. A quarter in which repurchases doubled to $9.6 billion is a concrete statement about where the stock trades against that yardstick, and the market has agreed: Class A shares are up more than 12% over the past month while the S&P 500 fell 5.5%, leaving Berkshire ahead 13% year to date against the index's 7.8%, and the shares surged this week as investors rotated out of technology stocks during the AI selloff. Share count stood at 1,418,900 Class A equivalents at September 30, shrinking as treasury stock at cost rose to $93,348 million from $78,939 million.
Which returns the piece to the arithmetic it opened with. Abel deployed roughly $30 billion across acquisitions and buybacks in nine months, slowed the equity purchases to a trickle, and still reported a cash position larger than the one he started the year holding. The constraint on Berkshire at this stage is the speed at which its own businesses hand Abel the next $30 billion.
