OMAHA, NE – August 8, 2026 (STL.News) – Berkshire Hathaway reported sharply higher second-quarter earnings as strong performance across many of its operating businesses and sizable investment gains lifted results, while the company again cautioned investors that quarterly net income can be distorted by accounting rules governing its investment portfolio. The conglomerate also accelerated share repurchases and reduced its massive cash holdings as management deployed more capital during the quarter.
Berkshire reported net earnings attributable to shareholders of $25.67 billion for the second quarter of 2026, more than double the $12.37 billion earned during the same period a year earlier. For the first six months of 2026, net earnings increased to $35.77 billion, compared with $16.97 billion in the first half of 2025.
Berkshire Hathaway Operating Earnings Show Broad-Based Strength
Investors generally place greater emphasis on Berkshire’s operating earnings because they exclude the large swings in investment gains and losses required under Generally Accepted Accounting Principles (GAAP).
Operating earnings increased to $12.98 billion during the second quarter from $11.16 billion a year earlier, representing approximately 16% year-over-year growth. First-half operating earnings rose to $24.33 billion, compared with $20.80 billion in the same period of 2025.
The improvement reflected stronger contributions from Berkshire’s railroad, energy, manufacturing, service, and retail businesses, partially offset by softer insurance results.
Berkshire Hathaway Investment Gains Lift Net Income
Investment gains totaled $12.68 billion during the second quarter, compared with $4.97 billion in the prior-year period.
The gains included:
- $10.9 billion in after-tax unrealized gains on equity investments.
- $1.8 billion in realized gains from investment sales.
- $11.44 billion in total investment gains during the first six months of 2026.
By comparison, the first half of 2025 included a small overall investment loss, largely reflecting market fluctuations.
Berkshire emphasized that these figures are driven largely by market movements and accounting requirements rather than the underlying performance of its businesses. The company reiterated that quarterly investment gains and losses “are usually meaningless” when evaluating long-term operating performance because unrealized changes in stock values must be recorded in earnings under GAAP.
Berkshire Hathaway – Manufacturing, Railroad and Energy Lead Growth
The largest contribution came from Berkshire’s manufacturing, service, and retail operations.
That segment generated $4.47 billion in second-quarter earnings, up from $3.60 billion a year earlier. For the first six months of 2026, earnings increased to $7.67 billion, compared with $6.66 billion during the same period last year.
BNSF Railway also delivered improved results, earning $1.56 billion during the quarter versus $1.47 billion a year ago. First-half earnings rose to $2.94 billion, compared with $2.68 billion.
Berkshire Hathaway Energy posted one of the strongest percentage gains, with second-quarter earnings climbing to $891 million from $702 million. First-half earnings increased to $2.01 billion, up from $1.80 billion.
The “Other” operating segment also recorded a significant improvement, helped in part by favorable foreign currency exchange movements. Berkshire reported $326 million in foreign currency gains during the quarter compared with $877 million in foreign currency losses during the second quarter of 2025.
Insurance Results Mixed
Insurance operations produced mixed results.
Insurance underwriting earnings declined modestly to $1.73 billion, compared with $1.99 billion in the second quarter of 2025.
Insurance investment income also eased, falling to $3.06 billion from $3.37 billion a year earlier.
Despite those declines, Berkshire’s insurance operations remain one of the company’s most valuable assets because they generate substantial insurance float that can be invested across the broader business.
At June 30, 2026, insurance float totaled approximately $177.5 billion, an increase of about $1.1 billion since the end of 2025.
Berkshire Hathaway – Share Buybacks Increase
Berkshire continued returning capital to shareholders by stepping up stock repurchases.
The company repurchased approximately $4.5 billion of Berkshire shares during the second quarter, bringing total buybacks during the first six months of 2026 to approximately $4.8 billion.
Independent reports also noted Berkshire continued buying back additional shares during July, signaling management’s confidence in the company’s long-term value.
At June 30, Berkshire had 1,431,693 Class A equivalent shares outstanding, reflecting the impact of those repurchases.
Capital Deployment Begins to Accelerate
One of the biggest developments during the quarter was Berkshire’s increased use of its enormous cash reserves.
The company reduced its cash and U.S. Treasury holdings to roughly $365 billion, down from record levels earlier in the year, as it repurchased stock, became a net buyer of publicly traded equities for the first time in more than three years, and completed major investments and acquisitions. Market observers said the shift marks one of the first major capital allocation moves under Chief Executive Greg Abel, who succeeded Warren Buffett as CEO earlier this year while Buffett remains chairman.
Why Operating Earnings Matter
Berkshire has consistently encouraged investors to focus on operating earnings rather than quarterly net income.
Under current accounting rules, unrealized gains and losses on equity securities must be included in reported earnings even though those investments may never be sold. As a result, quarterly net income can swing dramatically based solely on stock market movements.
Management believes operating earnings provide a clearer picture of the company’s underlying performance because they exclude those often-volatile investment gains and losses.
Outlook
Berkshire Hathaway continues to generate substantial earnings from its diversified collection of businesses, including insurance, freight rail transportation, utilities, energy, manufacturing, retail, and service companies.
The second quarter demonstrated that, despite weaker insurance profits, the company’s broad portfolio of operating businesses continued to produce steady growth. Combined with renewed capital deployment, increased share repurchases, and continued expansion of its investment portfolio, Berkshire enters the second half of 2026 with a strong balance sheet and significant financial flexibility.
Investment disclaimer: This article is for informational purposes only and should not be considered investment advice. Investors should perform their own research and consult a qualified financial adviser before making investment decisions.
