Warren Buffett turned Berkshire into $1.2T company, delivering 5.5M% return
What's the story
Warren Buffett, the legendary billionaire investor, has announced that he will step down as CEO of Berkshire Hathaway by end of this year. His close aide Greg Abel will serve as next CEO effective January 1, 2026. The news has triggered widespread recognition and appreciation for Buffett's incredible six-decade-long tenure at the helm of the company. Over the years, he gave an unbelievable 5.5 million percent return on per-share value over a period from 1964 to 2024, according to Bloomberg.
Investment success
Buffett's investment strategy outperforms S&P 500
Buffett's investment strategy has greatly outperformed the S&P 500 stock index (including dividends). Over the same 1964-2024 period, he delivered a return of nearly 20%, nearly double that of the S&P. Buffett's investment prowess has helped turn Berkshire Hathaway into one of the world's most valued companies (outside tech giants or oil producers) with a market capitalization standing at $1.2 trillion, eighth-highest in global public markets.
Business portfolio
Berkshire Hathaway: A diversified conglomerate
Buffett's Class A shares in Berkshire Hathaway are worth $167 billion. The company has a diverse portfolio of some 180 operating businesses, including auto dealerships, chemical producers, chocolate manufacturers, gas stations, home builders, as well as power utilities and railroads. These businesses together generate an annual revenue of nearly $400 billion.
Strategic investments
Buffett's stock selection and Berkshire Hathaway's cash reserves
Buffett is famous for picking stocks, including Apple, Bank of America, Coca-Cola, etc., that have grown tremendously. These stocks now make up 70% of Berkshire Hathaway's $263 billion stock portfolio. He once said, "One wonderful business can offset the many mediocre decisions that are inevitable." As of Q1 2024, Berkshire Hathaway holds a record cash reserve of $347.7 billion and owns 5% of US Treasury bills in circulation. Till 2024, all Berkshire companies combined had 392,396 employees.