Warren Buffett’s last year as CEO of Berkshire Hathaway looked nothing like a victory lap. Instead, the 95‑year‑old investor doubled down on the same principles that defined his six‑decade career: avoid overpriced assets, sell when valuations run hot, and keep cash ready for the moment the market finally cracks.
As Buffett prepares to step down on December 31, 2025, Berkshire Hathaway sits on a record $358 billion in cash, a war chest larger than the market caps of many S&P 500 companies. It’s a striking contrast to a year dominated by soaring stock indexes, AI‑driven euphoria, and geopolitical uncertainty. While the rest of Wall Street chased momentum, Buffett quietly positioned Berkshire for whatever comes next.
Cash Is King—Especially in a Frothy Market
Buffett has always been patient, but 2025 showcased that discipline at its peak. With U.S. equities hitting repeated all‑time highs and AI stocks driving some of the fastest sector rotations in years, Buffett chose to sit on the sidelines rather than chase performance.
At Berkshire’s annual meeting, he reiterated a mantra that has guided him for decades: "Better to have nothing than something bad."
If valuations don’t make sense, he won’t buy—no matter how much pressure the market applies. And in 2025, valuations rarely made sense.
Berkshire ended the year with its largest cash reserve ever, a pile built through consistent net selling. In the first nine months alone, Berkshire sold $10 billion more stock than it bought, marking the third straight year of net selling.
Trimming Apple at the Top
Apple remains Berkshire’s largest equity holding, but Buffett didn’t hesitate to trim exposure while tech stocks were still booming. He sold more than 60 million shares across Q2 and Q3, locking in profits after a multi‑year run that transformed Apple into Berkshire’s most successful investment of the past decade.
To longtime Berkshire watchers, the move was classic Buffett: sell when the market is euphoric, not when it’s panicking.
Chris Bloomstran of Semper Augustus summed it up well: "Buffett’s final-year playbook is the same as it’s been for 60 years—wait for the right pitch and never let a company get into trouble."
A Rare Purchase: OxyChem at a Discount
Despite his caution, Buffett did make one major acquisition in 2025: a $10 billion cash deal for OxyChem, the chemical subsidiary of Occidental Petroleum. The purchase fit neatly into Buffett’s long‑standing preference for buying strong businesses at attractive prices.
Morningstar analysts noted that Occidental was eager to reduce debt, giving Berkshire leverage to negotiate favorable terms. For Buffett, it was a rare opportunity in a year when most assets looked too expensive.
Staying Out of the Railroad Merger Frenzy
Berkshire’s BNSF Railway is one of the largest freight operators in the U.S., but Buffett resisted the temptation to join the 2025 wave of railroad consolidation. After Union Pacific announced plans to acquire Norfolk Southern, speculation swirled that Berkshire might pursue a similar deal.
Buffett quickly shut down the rumors. Instead of chasing another acquisition, Berkshire forged a new partnership with CSX—an approach that preserved cash while expanding operational flexibility.
A Voice of Caution in a Volatile Political Year
Buffett has never shied away from commenting on economic risks, and 2025 was no exception. In March, weeks before President Trump’s tariff announcement triggered a historic market selloff, Buffett warned that the proposed import duties amounted to an "act of war."
His message was clear: geopolitical shocks can hit markets without warning, and cash is the best insurance policy.
That philosophy guided Berkshire through the turbulence that followed. While other investors scrambled to reposition, Buffett had the liquidity to act if needed—though he ultimately chose to wait for better opportunities.
The Succession Surprise
Perhaps the biggest shock of Buffett’s final year wasn’t a trade, but the timing of his retirement announcement. At the May shareholders meeting in Omaha, he revealed that Greg Abel would take over as CEO at year‑end—a timeline that surprised even Abel.
Since then, Buffett has gradually stepped back from the spotlight. In his Thanksgiving letter, he told shareholders he would "remain quiet" going forward, while expressing unwavering confidence in Abel’s leadership.
"Abel’s understanding of the growth potential and risks of our insurance business is far deeper than that of many seasoned executives," Buffett wrote.
A $358 Billion Gift to His Successor
Buffett’s final act as CEO may be his most powerful: handing Greg Abel a balance sheet loaded with cash and virtually no pressure to deploy it immediately.
During the 2008 financial crisis, Berkshire famously stepped in to rescue General Electric and Goldman Sachs. Buffett has always believed that the best deals appear when markets are panicking—not when they’re euphoric.
And he made it clear at the 2025 shareholder meeting that Berkshire is ready to strike again: "We won’t hesitate to spend $100 billion when the right opportunity comes."
But he also reminded investors that opportunities don’t arrive on a schedule: "Good opportunities will come again. It might be next week, it might be five years from now—but it certainly won’t be 50 years from now."
The Final Lesson: Patience Over Prediction
As Buffett steps down, his final year offers a masterclass in disciplined investing:
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Sell when valuations are stretched
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Buy only when prices make sense
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Hold cash when the world is uncertain
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Wait for the market to come to you
In a year defined by AI mania, geopolitical shocks, and record‑breaking stock prices, Buffett chose restraint over risk-taking. And in doing so, he leaves Berkshire Hathaway—and his successor—with the most formidable cash arsenal in the company’s history.
For investors, the message is unmistakable: In uncertain times, patience is not just a virtue—it’s a strategy.