OMAHA — Greg Abel spent his first full year running Berkshire Hathaway watching Warren Buffett’s $397 billion cash pile shrink. He did it deliberately.
Berkshire (BRK.A, BRK.B) reported second-quarter operating earnings of $12.98 billion on Saturday, up 16 percent from $11.16 billion a year earlier, as Abel moved on two priorities Buffett long resisted: technology at scale and homebuilding. Net income attributable to Berkshire shareholders nearly doubled to $25.67 billion, powered by $12.68 billion in after-tax investment gains, as CNBC reported Saturday morning.
The numbers confirm what has been building since January. This is a different company under new management.
In the quarterly filing, Berkshire disclosed that Alphabet Inc. (GOOGL) had become its single largest equity holding as of June 30, displacing Apple Inc. after nearly a decade at the top of the portfolio. The shift traces to June, when Berkshire committed $10 billion to Alphabet as part of an $80 billion equity raise. Buffett had admired Google’s parent company for years and never bought it. Abel bought $10 billion worth within six months of taking the chair.
“We are deploying capital where we see the best long-term risk-adjusted returns,” Abel said in the earnings release, offering no elaboration on specific positions, a studied reticence that has characterized his communication style since taking over.
The Alphabet position anchored a broader reorientation. Berkshire’s total equity portfolio reached $323.8 billion at June 30, up from $297.8 billion at year-end 2025. The cost basis of its commercial, industrial and other equity positions, the category that now houses Alphabet, expanded by $24.1 billion in the first half alone, from $58 billion to $82.1 billion. In the same period of 2025, Berkshire made net equity purchases of $7.1 billion; the first six months of 2026 produced $39.4 billion, a nearly fivefold acceleration.
Apple still occupies a top-five position but has lost its primacy after a difficult stretch. Shares of the iPhone maker fell more than 8 percent in late July after disclosures about rising memory costs that would weigh on margins through 2027. That slide accelerated what the Alphabet purchase had already set in motion.
Abel’s bet on housing shows a different dimension of his approach. The acquisition of Taylor Morrison landed Berkshire inside U.S. residential construction just as mortgage rates began easing from two-year highs. The homebuilder operates across fourteen states with particular density in Sun Belt markets where population growth has held steady. Berkshire completed the $9.7 billion deal in the first half of 2026, and Taylor Morrison contributed to what became the strongest segment of the quarter.
Manufacturing, service and retail operating earnings reached $4.47 billion, up 24 percent from $3.6 billion a year earlier. That was the biggest single driver of the earnings beat, reflecting Taylor Morrison’s partial-quarter contribution and continued strength across Berkshire’s industrial subsidiaries.
Insurance, however, offered a note of caution. Underwriting earnings fell to $1.73 billion from $1.99 billion in the second quarter of 2025, as higher property catastrophe losses weighed on results. Investment income from the insurance float declined to $3.06 billion from $3.37 billion a year earlier, partly because the vast short-term Treasury position that generated that income has shrunk as Abel deployed capital elsewhere.
Total cash ended June at $41.4 billion, down from $52.6 billion at the start of the year and far below the $397 billion reserve Abel inherited. Buffett once spoke of roughly $150 billion as a floor required to backstop Berkshire’s catastrophic insurance obligations. At $41 billion, Abel appears to have set that threshold aside. Whether permanently is not discernible from the 10-Q filing released Saturday.
The buybacks are new territory. Buffett repurchased no Berkshire stock during 2025 through the transition period. The $4.5 billion Abel deployed in share repurchases during the second quarter marks the most aggressive buyback program since the pandemic era. BRK.B touched a fresh 52-week high near $525 during the quarter.
The Alphabet investment reflects something Buffett’s approach never did: a willingness to pay a premium multiple for a technology business whose competitive moat runs through software and data rather than physical assets. Search revenue remains structurally dominant. Cloud infrastructure is growing faster than the broader enterprise software market. Capital returns to shareholders have accelerated under chief executive Sundar Pichai.
What comes next remains unclear. With the cash position now well below any historical floor his predecessor established, Abel must decide whether to let the earnings base rebuild the buffer or press further into capital deployment. His first six months suggest an investor who found his footing faster than most Berkshire watchers expected. The company taking shape looks materially different from the one Buffett left behind, and nothing in the filings suggests that was accidental.
