Berkshire Hathaway facts for kids
 |
|
Blackstone Plaza, the location of Berkshire's corporate offices in Omaha, Nebraska
|
|
| Public | |
| Traded as | |
| ISIN | ISIN: [https://isin.toolforge.org/?language=en&isin=US0846707026 US0846707026] |
| Industry | Conglomerate |
| Predecessor |
|
| Founded | 1839 |
| Founder | Oliver Chace |
| Headquarters | Blackstone Plaza,
,
U.S.
|
|
Area served
|
Worldwide |
|
Key people
|
|
| Products |
List
Property & casualty insurance
Reinsurance Rail transport Electric power Natural gas Real estate services Industrial parts & materials Mobile homes Building materials Recreational vehicles Apparel Retail stores & services Aviation services |
| Revenue |  US$371.4 billion (2024) |
|
Operating income
|
 US$110.4 billion (2024) |
| US$88.99 billion (2024) |
|
| Total assets | US$1.154 trillion (2024) |
| Total equity | US$651.7 billion (2024) |
| Owner | Warren Buffett (14.3%) |
|
Number of employees
|
392,400 (2024) |
| Subsidiaries | See List of subsidiaries |
Berkshire Hathaway Inc. is a huge American company based in Omaha, Nebraska. It's a multinational conglomerate, which means it owns many different types of businesses around the world.
The company started as a textile (fabric) maker in 1965. Then, under the leadership of Warren Buffett and Charlie Munger, it grew into the giant company it is today. Greg Abel now helps manage many of the company's investments. Warren Buffett still owns a large part of Berkshire Hathaway.
Many people compare Berkshire Hathaway to an investment fund. From 1965 to 2023, the company's investments grew much faster than the average stock market. In August 2024, Berkshire Hathaway became one of the few U.S. companies worth over $1 trillion. It was the first non-technology company to reach this huge value.
Berkshire Hathaway is one of the largest companies in the United States based on its total income. It's also one of the top ten companies in the S&P 500, which is a list of 500 large U.S. companies. Its Class A shares have the highest price per share of any public company in the world, reaching $700,000 in August 2024. This is because the company has chosen not to split its stock into smaller, cheaper shares.
Contents
Company History
Berkshire Hathaway began as a textile company in 1955. It was formed when two fabric companies, Hathaway Manufacturing Company and Berkshire Fine Spinning Associates, joined together. After the merger, Berkshire Hathaway had 15 factories and over 12,000 workers. However, many of these factories closed by the end of the 1950s.
In 1962, Warren Buffett started buying shares of Berkshire Hathaway. He hoped to sell them for a profit later. In 1964, he tried to sell his shares back to the company. But the company offered him a slightly lower price than they had promised. This made Buffett upset. Instead of selling, he bought even more shares to take control of the company.
Buffett later said that buying the textile company was his biggest investment mistake. He felt it cost him a lot of money he could have made elsewhere. In 1985, the company's last textile operations were finally shut down.
In 1962, Warren Buffett set up his office in Omaha, Nebraska. This is still Berkshire Hathaway's main office today. As of late 2024, the company's main headquarters had only 27 employees.
What Berkshire Hathaway Owns
Berkshire Hathaway has bought many different companies over the years. Here are some of its major acquisitions:
- In 1967, Berkshire bought National Indemnity Company, an insurance business. This was the first company Buffett bought for Berkshire.
- In 1972, Berkshire acquired See's Candies for $25 million. This candy company makes boxed chocolates. By 2019, this investment had grown to be worth over $2 billion for Berkshire.
- In 1976, Berkshire first invested in GEICO, a car insurance company known for its gecko mascot. Berkshire bought full ownership of GEICO in 1996.
- In 1983, Berkshire acquired Nebraska Furniture Mart, a large furniture store.
- In 1997, Berkshire bought FlightSafety International (FSI), a company that trains pilots using flight simulators.
- In October 1997, Berkshire acquired Dairy Queen for $585 million. Dairy Queen sells ice cream and other snacks.
- In 1998, Berkshire Hathaway acquired NetJets. This company offers private jet services, where people can own a part of a plane.
- In 1999, Berkshire acquired MidAmerican Energy Holdings, which was later renamed Berkshire Hathaway Energy (BHE). This company owns power plants and real estate businesses.
- In 2003, Berkshire acquired McLane Company from Walmart. McLane provides wholesale distribution services to stores and restaurants.
- In August 2003, Berkshire Hathaway acquired Clayton Homes, a company that makes manufactured homes.
- In July 2005, Berkshire Hathaway acquired Forest River, which is the world's largest seller of recreational vehicles (RVs).
- In February 2010, Berkshire bought the remaining part of BNSF Railway for $26 billion. This was the largest purchase in Berkshire's history at the time.
- In February 2016, Berkshire Hathaway acquired Duracell batteries.
- In 2017, Berkshire acquired a large part of Pilot Flying J, a chain of truck stops. It bought the rest of the company in 2024.
- In October 2022, Berkshire Hathaway acquired the insurance company Alleghany Corporation.
Major Stock Investments
Besides owning entire companies, Berkshire Hathaway also invests in the stock of many other large companies.
- Berkshire Hathaway bought shares in Amazon.com in 2019.
- In September 2008, during a financial crisis, Berkshire invested $5 billion in Goldman Sachs, a major investment bank. This helped Goldman Sachs and earned Berkshire a lot of money.
- In 2008, Berkshire invested in BYD Auto, a Chinese electric vehicle company.
- In August 2011, Berkshire Hathaway bought $5 billion of shares in Bank of America, a large bank.
- In 2013, Berkshire and another company bought H. J. Heinz Company. Later, Heinz merged with Kraft Foods to form Kraft Heinz.
- In 2016, Berkshire started investing in Apple Inc.. By late 2022, it owned 5.8% of Apple. However, in 2024, Berkshire sold almost half of its Apple shares. Warren Buffett has said he sees Apple as a consumer products company, which he understands well.
- In 2016, Berkshire surprised many by investing heavily in major U.S. airlines. Buffett had previously called airlines a "deathtrap for investors." But in April 2020, Berkshire sold all its airline shares due to the pandemic's effect on air travel.
- Since 2022, Berkshire has been investing in Occidental Petroleum, an oil company.
- Between 2019 and 2020, Berkshire bought more than 5% of five large Japanese trading companies. By April 2023, it increased its ownership in each of these companies to 7.4%.
- In 2024, Berkshire Hathaway bought shares in Constellation Brands, a company that makes alcoholic beverages.
- Also in 2024, Berkshire Hathaway sold all its shares in Ulta Beauty and all its investments in S&P 500 exchange-traded funds (ETFs).
What Berkshire Hathaway Owns
Here are some of the types of businesses and companies Berkshire Hathaway owns or has invested in:
Companies Owned by Berkshire
| Business Type | Companies |
|---|---|
| Insurance |
|
| Railroad | BNSF Railway |
| Utilities & Energy |
|
| Manufacturing |
|
| Services & Retail |
|
Major Stock Investments
Berkshire Hathaway also holds large investments in other public companies:
| Category | Company | Berkshire's Share (%) | Value (approx.) |
|---|---|---|---|
| Finance & Insurance | American Express | 21.6 | $45.4 billion |
| Bank of America | 8.9 | $30.7 billion | |
| Moody's Ratings | 13.6 | $12.6 billion | |
| Chubb Limited | 6.7 | $7.1 billion | |
| Manufacturing | The Coca-Cola Company | 9.3 | $27.8 billion |
| Kraft Heinz | 26.9 | $9.7 billion | |
| BYD Auto | 4.9 | $2.6 billion | |
| Technology | Apple Inc. | 2.0 | $73.6 billion |
| Amazon.com | 0.1 | $2.2 billion | |
| Petroleum | Chevron Corporation | 6.6 | $18.7 billion |
| Occidental Petroleum | 28.2 | $13.6 billion | |
| Diversified | Mitsubishi | 8.9 | $5.6 billion |
| Itochu | 7.5 | $4.8 billion | |
| Mitsui | 8.4 | $4.5 billion |
In addition to these investments, Berkshire Hathaway has a lot of cash and government bonds. This is the largest amount of cash held by any U.S. public company. The company keeps a lot of cash to make sure it can pay its insurance claims.
How Berkshire Hathaway Works
Investment Ideas
Berkshire Hathaway's main business is insurance. The money collected from insurance premiums (called "float") is used to invest in other companies. Warren Buffett likes to invest in businesses that are stable and make money over a long time. He avoids companies he doesn't fully understand. He also generally avoids investing in technology companies, though Apple is a big exception.
Berkshire Hathaway has two types of shares: Class A and Class B. The Class A shares are very expensive because the company has never split them into smaller, more affordable pieces. This is done to attract investors who want to hold shares for a long time, not just for quick trading.
In 1996, Berkshire created Class B shares. These shares are much cheaper and have less voting power. This was done to stop other groups from creating investment funds that would try to copy Berkshire's investments. In 2010, the Class B shares were split 50-to-1, making them even more affordable.
- Shares closed over $1,000 for the first time in 1983.
- They closed over $10,000 in 1992.
- They closed over $100,000 in 2006.
- They closed over $200,000 in 2014.
- They closed over $500,000 for the first time in March 2022.
Executive Pay
Warren Buffett's salary as CEO is $100,000 per year. This is very low compared to other CEOs of large companies. He has kept this salary for 35 years. He also gets about $300,000 for home security services each year.
Other top executives, Greg Abel and Ajit Jain, each receive $20 million per year. They can also get a $3 million bonus.
Annual Meetings
Warren Buffett writes a letter to shareholders every year. These letters are very popular and explain the company's performance and his thoughts on investing.
Berkshire's annual shareholder meetings are held in Omaha, Nebraska. They are often called "Woodstock for Capitalists" because over 40,000 people attend. The meetings last for many hours, with Buffett and other leaders answering questions from shareholders.
The meetings are known for being fun and light-hearted. They usually start with a funny cartoon made for Berkshire shareholders. For example:
- The 2007 cartoon showed Buffett playing basketball against LeBron James.
- The 2008 cartoon showed Charlie Munger becoming President of the United States.
- The 2022 cartoon featured a veterinarian who grew his business using his American Express credit card.
Company Leaders
The board of directors for Berkshire Hathaway includes Warren Buffett (chairman), Greg Abel (vice chairman for non-insurance businesses), and Ajit Jain (vice chairman for insurance businesses). Other board members include Buffett's children, Susan Alice Buffett and Howard Graham Buffett.
Charlie Munger was the vice chairman of the company from 1978 until he passed away in November 2023.
In May 2021, Warren Buffett announced that Greg Abel would be his successor as CEO of Berkshire Hathaway. In May 2025, Buffett said he plans to retire as CEO at the end of 2025, with Greg Abel taking over.
Awards and Recognition
Berkshire Hathaway has often been recognized as one of the most respected companies in the world. In 2007, Barron's magazine named it the most respected company based on a survey of money managers. It was also ranked highly in similar surveys in 2014, 2015, and 2016.
Images for kids
-
C-17 Globemaster III full flight simulator at Joint Base Pearl Harbor–Hickam
-
A HomeServices of America in Gillette, Wyoming
See also
In Spanish: Berkshire Hathaway para niños
