Berkshire earnings rose last quarter and CEO Greg Abel is staring to deploy Buffett's massive cash hoard

Berkshire Hathaway's operating earnings climbed 16% in the second quarter as strength across its energy, railroad and manufacturing businesses more than offset weaker insurance results. But the bigger takeaway from the results is that CEO Greg Abel is starting to put the record cash hoard amassed by Warren Buffett to work on buybacks and stock purchases. Operating earnings rose to $12.98 billion from $11.16 billion a year earlier. Manufacturing, service and retailing earnings jumped 24% to $4.47 billion, while Berkshire Hathaway Energy's profit surged 27% to $891 million. BNSF, the company's railroad, posted a 6% increase to $1.56 billion. Insurance was a weak spot. Underwriting earnings fell 13% to $1.73 billion from $1.99 billion a year earlier, while insurance investment income declined 9% to $3.06 billion. Berkshire repurchased approximately $4.5 billion of its own shares during the quarter, the second fiscal period under Abel, who took over from Buffett at the start of the year. The second quarter purchases marked a sharp acceleration from the $235 million spent on buybacks in the first three months of 2026, though it might be less than some expectations heading into the report. Berkshire's cash pile declined to $365.5 billion at the end of June from a record $397.4 billion three months earlier, as the conglomerate deployed capital through other investments along with the buybacks. The quarter included the closing of Berkshire's acquisition of Taylor Morrison. Berkshire reversed a pattern of selling stocks, becoming a net buyer of equities in the second quarter with nearly $20 billion in net purchases. The conglomerate had been a net seller of stocks for 14 consecutive quarters before the latest period. Buffett, now chairman, handed Abel a cash fortress unprecedented in corporate America, but in accordance with the 95-year-old legendary investor's patient and risk averse approach. Buffett had indicated for a while that he was having trouble finding any values in the equity market. Shareholders have been clamoring for Abel to put some of that cash to work outside of Treasuries. Shares of Berkshire are up just 3% on the year, underperforming the S&P 500's 13% gain. Though the stock has on the move lately, rising 9% the last three months. The filing indicated Alphabet is now among Berkshire's five largest equity holdings by market value at the end of June, alongside its longtime holdings American Express, Apple, Bank of America and Coca-Cola. Berkshire disclosed a $10 billion investment in the Google parent earlier this year to help fund AI development. Buffett told CNBC that he initiated the Alphabet investment after consulting with Abel.