Warren Buffett’s latest annual letter to Berkshire Hathaway shareholders confirms that the Omaha-based conglomerate is sitting on a record-breaking USD 321.4 billion in cash and Treasury bills. Some investors might be unsettled by this growing war chest, but Buffett’s reassurance is as unwavering as ever: there’s no lack of appetite, just a lack of the right opportunities.
In the final quarter of 2024, Berkshire’s cash holdings grew by 3.6%. While sceptics argue that such a large pile might suggest market pessimism, Buffett counters that “the great majority of [investor’s] money remains in equities.” His stance is clear: Berkshire Hathaway’s core operating businesses, from railroads to utilities, remain robust. What the company is truly waiting for is a deal that meets Buffett’s exacting criteria—an outstanding business at a sensible price.
According to CNBC’s coverage of the letter, Buffett is not “hoarding cash” due to fear, but because he simply hasn’t found anything worth “splurging on.” Historically, when the right opportunity knocks—such as Precision Castparts or the BNSF Railway—Buffett doesn’t hesitate.
One unexpected reveal in the letter was the confirmation of Berkshire’s accelerated investments in five major Japanese trading houses: Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo. Initially capped at 9.9% ownership, these stakes are now set to rise with the blessing of the Japanese firms—a notable development given Japan’s traditionally insular corporate culture.
In an interview cited by Reuters, Buffett lauded the trading houses’ diversified revenue streams and lauded their openness to Berkshire’s long-term partnership approach. This international move showcases Berkshire’s strategy of broadening its horizons without diluting its core principle of investing in fundamentally strong, well-managed companies.
True to form, Berkshire isn’t paying dividends—something it hasn’t done since 1967. In the letter, Buffett reiterates the “miracle of compounding” that comes from reinvestment, arguing that this policy transformed Berkshire into what he calls a “trillion-dollar” company (if you include its market capitalisation and retained earnings over decades).
What did surprise some analysts, however, was the absence of stock buybacks for the second consecutive quarter. This pause suggests Buffett no longer sees Berkshire’s own share price as trading at a discount. Traditionally, buybacks ramp up only when Buffett believes the stock is undervalued—an indicator that he’s currently comfortable with its valuation.
The letter’s biggest zinger might be Buffett’s personal thanks to the United States government. Berkshire paid USD 26.8 billion in federal corporate income taxes in 2024, about 5% of the country’s total corporate tax take. In his open letter to Uncle Sam, Buffett urged the government to “spend it wisely” and to “take care of the many who… get the short straws in life.” He also reminded policymakers of their duty to maintain a stable currency—a nod to the crucial role monetary and fiscal policy play in creating a secure environment for business.
“Thank you, Uncle Sam. Someday your nieces and nephews at Berkshire hope to send you even larger payments than we did in 2024. Spend it wisely. Take care of the many who, for no fault of their own, get the short straws in life. They deserve better. And never forget that we need you to maintain a stable currency and that result requires both wisdom and vigilance on your part.”
Berkshire posted USD 89 billion in profits for 2024, a slight dip from USD 96.2 billion in the previous year. Yet, operating earnings—Buffett’s preferred metric—climbed to USD 47.4 billion, underscoring the robustness of Berkshire’s core businesses. Shareholders also saw a healthy start in 2025, with Berkshire’s stock rising 5.6%, outpacing the S&P 500’s 2.2% gain year-to-date.
Ultimately, Buffett’s message remains consistent: “Good businesses always beat cash in the long run.” That philosophy underpins his patient, value-driven approach—one that has historically rewarded Berkshire shareholders handsomely.
Disclaimer: The information provided here is for educational purposes and does not constitute financial advice. Always consult a qualified financial adviser before making investment decisions.
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