BERKSHIRE HATHAWAY INC

Previous wording

Our periodic operating results may be affected in future periods by the impacts of ongoing macroeconomic and geopolitical conflicts and events, as well as changes in industry or company-specific factors or events. These events, including tensions from developing international trade policies and tariffs, accelerated through the first nine months of 2025. Considerable uncertainty remains as to the ultimate outcome of these events. We are currently unable to reliably predict the ultimate impact on our businesses, whether through changes in the availability of products, supply chain costs and efficiency, and customer demand for our products and services. It is reasonably possible there could be adverse consequences on our operating businesses, as well as on our investments in equity securities, which could significantly affect our future results.

Current wording

Our periodic operating results may be affected in future periods by the impacts of ongoing macroeconomic and geopolitical conflicts and events, including wars, tensions from developing international trade policies and tariffs, as well as changes in industry or company-specific factors or events. Considerable uncertainty remains as to the ultimate outcome of these events. We are currently unable to reliably predict the ultimate impact on our businesses, whether through changes in the availability of products, supply chain costs and efficiency, and customer demand for our products and services. It is reasonably possible there could be adverse consequences on our operating businesses, as well as on our investments in equity securities, which could significantly affect our results.

Previous wording

After-tax earnings from our manufacturing, service and retailing businesses increased $274 million (8.2%) in the third quarter and $467 million (4.8%) in the first nine months of 2025 compared to 2024. Results among our numerous operations were mixed.

Current wording

Earnings from our manufacturing, service and retailing businesses increased 4.5% in the first quarter of 2026 compared to 2025. Results among our numerous operations in 2026 were mixed, with overall earnings increases in our manufacturing and service businesses and lower earnings from the retailing businesses.

Previous wording

After-tax other earnings include corporate investment income not allocated to operating businesses, earnings from equity method investments (excluding the other-than-temporary impairment loss recognized in the second quarter of 2025 on Berkshire’s investment in Kraft Heinz) and foreign currency exchange rate gains and losses related to Berkshire and BHFC non-U.S. Dollar denominated debt. After-tax corporate investment income increased $533 million in the third quarter and $1.6 billion in the first nine months of 2025 compared to 2024, primarily attributable to the impact of increased investments derived from subsidiary capital distributions to Berkshire. Foreign currency exchange rate changes on the non-U.S. Dollar denominated debt produced after-tax gains of $331 million in the third quarter and after-tax losses of $1.3 billion in the first nine months of 2025 compared to after-tax losses of $1.1 billion in the third quarter and $98 million in the first nine months of 2024.

Current wording

After-tax other earnings in the first quarter include investment income not allocated to operating businesses, earnings from equity method investments and foreign currency exchange rate gains and losses related to Berkshire and BHFC non-U.S. Dollar denominated debt. After-tax other earnings in the first quarter of 2026 increased $1.2 billion compared to 2025, reflecting after-tax foreign currency exchange rate gains of $249 million in 2026 compared to losses of $713 million in 2025 and increased investment income.

Previous wording

Our periodic underwriting earnings may be subject to considerable volatility from the timing and magnitude of significant property catastrophe loss events. We currently consider consolidated pre-tax losses exceeding $150 million from an event occurring in the current year to be significant. We incurred significant losses from the Southern California wildfires in the first quarter of 2025 and from Hurricane Helene in the third quarter of 2024. Changes in estimates for unpaid losses and loss adjustment expenses, including amounts established for occurrences in prior years, and foreign currency transaction gains and losses arising from the remeasurement of non-U.S. Dollar denominated assets and liabilities can also significantly affect our periodic underwriting results.

Current wording

Our periodic underwriting earnings may be subject to considerable volatility from the timing and magnitude of significant property catastrophe loss events. We currently consider consolidated pre-tax losses exceeding $150 million from an event occurring in the current year to be significant. Changes in estimates for unpaid losses and loss adjustment expenses (“LAE”), including amounts established for occurrences in prior years, and foreign currency transaction gains and losses arising from the remeasurement of non-functional currency denominated assets and liabilities can also significantly affect our periodic underwriting results.

Previous wording

We write primary insurance and reinsurance policies covering property and casualty risks, as well as life and health risks. Our insurance and reinsurance businesses are GEICO, Berkshire Hathaway Primary Group (“BH Primary”) and Berkshire Hathaway Reinsurance Group (“BHRG”). We strive to generate pre-tax underwriting earnings (defined as premiums earned less insurance losses/benefits incurred and underwriting expenses) over the long term in all business categories, except in our retroactive reinsurance and periodic payment annuity businesses. Time-value-of-money concepts are important considerations in establishing premiums for these policies, which are recognized as charges to earnings over the claim settlement periods.

Current wording

We write primary insurance and reinsurance policies covering property and casualty risks, as well as life and health risks. Our insurance and reinsurance businesses are GEICO, Berkshire Hathaway Primary Group (“BH Primary”) and Berkshire Hathaway Reinsurance Group (“BHRG”). We strive to generate pre-tax underwriting earnings (defined as premiums earned less insurance losses/benefits incurred and underwriting expenses) over the long term in all business categories, except in our retroactive reinsurance and periodic payment annuity businesses. Time-value-of-money concepts are important considerations in establishing premiums received at the inception of our retroactive reinsurance and periodic payment annuity contracts. While no new retroactive reinsurance or periodic payment annuity contracts have been written in recent years, we will continue to record charges to earnings related to the run-off of pre-existing contracts over the remaining claim settlement periods.

Previous wording

GEICO writes property and casualty insurance policies, primarily private passenger automobile insurance, in all 50 states and the District of Columbia. GEICO offers its policies mainly by direct response methods where most customers apply for insurance coverage directly to the company. GEICO also operates an insurance agency that offers primarily homeowners and renters insurance to its auto policyholders. A summary of GEICO’s underwriting results follows (dollars in millions).

Current wording

GEICO writes property and casualty insurance policies, primarily private passenger auto insurance, in all 50 states and the District of Columbia. Additionally, GEICO writes insurance policies for certain commercial auto risks, which currently represents less than 5% of premiums written. GEICO offers its policies mainly by direct response methods where most customers apply for insurance coverage directly to the company, and, to a lesser extent, through insurance agencies. GEICO also operates an insurance agency that offers insurance policies written by third parties, such as homeowners, renters, condominium, life and identity protection insurance. A summary of GEICO’s underwriting results follows (dollars in millions).

Previous wording

Private passenger automobile claims frequencies declined in the first nine months of 2025 versus 2024 for property damage and collision coverages (two to five percent range), with bodily injury coverage frequency increasing (two to five percent range). Average claims severities in the first nine months of 2025 increased for property damage and collision coverages (two to four percent range) and increased for bodily injury coverage (eleven to thirteen percent range) compared to 2024. Losses and loss adjustment expenses included reductions in the ultimate loss estimates for prior accident years’ claims of $495 million in the first nine months of 2025 compared to $339 million in 2024.

Current wording

Private passenger auto claims frequencies increased in the first quarter of 2026 for bodily injury coverage (five to seven percent range) and property damage and collision coverages (two to four percent range) compared to 2025. Private passenger auto average claims severities in the first quarter of 2026 increased for bodily injury coverages (12 to 14 percent range) and for property damage and collision coverages (two to four percent range) compared to 2025. Changes in ultimate loss estimates for prior accident years’ claims in the first quarter of 2026 and 2025 were relatively insignificant.

Previous wording

Underwriting expenses increased $412 million (39.9%) in the third quarter and $1.0 billion (36.6%) in the first nine months of 2025 compared to 2024. GEICO’s expense ratio (underwriting expense to premiums earned) was 11.8% in the first nine months of 2025, an increase of 2.7 percentage points compared to 2024. The increases were attributable to increased policy acquisition-related expenses. The earnings from GEICO’s insurance agency (third-party commissions, net of operating expenses) are included as a reduction of underwriting expenses.

Current wording

Underwriting expenses increased $338 million (29.3%) in the first quarter of 2026 compared to 2025. The expense ratio (underwriting expense to premiums earned) was 13.4% in the first quarter of 2026, an increase of 2.6 percentage points compared to 2025. These increases were primarily driven by increased policy acquisition-related expenses. The earnings from GEICO’s insurance agency (third-party commissions, net of operating expenses) are included as a reduction of underwriting expenses.

Previous wording

BH Primary consists of several independently managed underwriting operations that provide a variety of primarily commercial insurance solutions, including healthcare professional liability, workers’ compensation, automobile, general liability, property and specialty coverages for small, medium and large clients. These operations include Berkshire Hathaway Specialty Insurance (“BHSI”), RSUI Group (“RSUI”), CapSpecialty, Berkshire Hathaway Homestate Companies (“BHHC”), MedPro Group (“MedPro”), GUARD Group (“GUARD”), National Indemnity Company (“NICO Primary”), Berkshire Hathaway Direct (“BH Direct”) and U.S. Liability Insurance Companies (“USLI”).

Current wording

BH Primary consists of numerous separately managed businesses that provide a wide variety of primarily commercial insurance solutions, including healthcare professional liability, workers’ compensation, automobile, general liability, property and specialty coverages. BH Primary’s insurers include Berkshire Hathaway Specialty Insurance Group (“BHSI”), RSUI, CapSpecialty, Berkshire Hathaway Homestate Group (“BHHC”), MedPro, GUARD Insurance Companies (“GUARD”), NICO Primary Group (“NICO Primary”), Berkshire Hathaway Direct (“BH Direct”) and U.S. Liability Insurance companies (“USLI”).

Previous wording

Losses and loss adjustment expenses declined $597 million (18.2%) in the third quarter and $361 million (3.8%) in the first nine months of 2025 compared to 2024. The loss ratio decreased 8.3 percentage points in the third quarter and increased 1.2 percentage points in the first nine months of 2025 compared to 2024. Losses incurred from significant catastrophe events were approximately $760 million in the first nine months of 2025, attributable to the Southern California wildfires in the first quarter, and were approximately $380 million in the first nine months of 2024 from Hurricane Helene in the third quarter. Additionally, losses and loss adjustment expenses in the first nine months of 2025 were reduced $898 million compared to $1.2 billion in 2024 from reductions of estimated ultimate claim liabilities for prior accident years’ claims. The reductions were mostly attributable to lower-than-expected property losses.

Current wording

Losses and LAE declined $715 million (19.9%) in the first quarter of 2026 compared to 2025, and the loss ratio in 2026 declined 10.0 percentage points compared to 2025. There were no losses incurred from significant catastrophe event occurrences in the first quarter of 2026 compared to $770 million in 2025. Additionally, changes in prior accident years’ ultimate loss estimates in the first quarter reduced incurred losses by $260 million in 2026 and $330 million in 2025. The reductions were mostly attributable to lower-than-expected property losses.

Previous wording

The liability for unpaid losses and loss adjustment expenses for retroactive reinsurance contracts declined $1.1 billion in the first nine months of 2025 to $31.3 billion at September 30, 2025, primarily due to loss payments. Deferred charge assets on retroactive reinsurance contracts declined $499 million in the first nine months of 2025 to $8.3 billion at September 30, 2025, which will be charged to earnings over the expected remaining claims settlement periods.

Current wording

Unpaid losses and LAE for retroactive reinsurance contracts were $30.4 billion at March 31, 2026, a decline of $680 million from December 31, 2025, due primarily to loss payments. Deferred charge assets on retroactive reinsurance were $7.9 billion and $8.1 billion at March 31, 2026 and December 31, 2025, respectively. Deferred charge balances will be charged to earnings over the expected remaining claims settlement periods.

Previous wording

Premium rates for new periodic payment annuity business continue to be at unacceptable levels. We have not written any new business since 2022. Pre-tax underwriting losses from periodic payment annuity contracts in each period included the accretion of discounted liabilities, including liabilities for contracts without life contingencies, as well as foreign currency exchange gains and losses on non-U.S. Dollar denominated contracts. Changes in foreign currency exchange rates produced pre-tax losses of $110 million in the first nine months of 2025 compared to $96 million in 2024. Pre-tax underwriting losses before foreign currency effects were $428 million in the first nine months of 2025 compared to $447 million in 2024, primarily attributable to recurring discounted liability accretion. Periodic payment annuity liabilities were $14.6 billion at September 30, 2025, which included liabilities of $4.0 billion for contracts without life contingencies, as well as the effects of discount rate changes recorded in accumulated other comprehensive income.

Current wording

Pre-tax losses, before foreign currency exchange gains and losses, were $152 million in the first quarter of 2026 versus $150 million in 2025 and derived primarily from the accretion of discounted annuity liabilities. Pre-tax foreign currency exchange rate gains on non-functional currency denominated contracts of U.S. subsidiaries were $16 million in the first quarter of 2026 compared to losses of $49 million in 2025. Annuity liabilities were $14.1 billion at March 31, 2026, including the effects of discount rate changes recorded in accumulated other comprehensive income, as well as liabilities of $4.0 billion on contracts without life contingencies.

Previous wording

Our variable annuity guarantee reinsurance contracts produced pre-tax earnings of $33 million in the first nine months of 2025 compared to $30 million in 2024. Earnings are affected by changes in securities markets, interest rates and foreign currency exchange rates. These contracts have been in run-off for many years.

Current wording

Earnings or losses on our variable annuity guarantee reinsurance contracts are affected by changes in securities markets, interest rates, foreign currency exchange rates and policyholder behavior. While these contracts have been in run-off for many years, periodic earnings are subject to considerable volatility from the inherent volatility of market prices and rates.

Previous wording

Invested assets of our insurance businesses derive from shareholder capital and net liabilities assumed under insurance contracts or “float.” The major components of float are unpaid losses and loss adjustment expenses, including liabilities under retroactive reinsurance contracts, life, annuity and health benefit liabilities, unearned premiums and certain other liabilities, which are reduced by insurance premiums receivable, reinsurance receivables, deferred charges assumed under retroactive reinsurance contracts and deferred policy acquisition costs. The effect of discount rate changes on long-duration insurance contracts, recorded in accumulated other comprehensive income, is excluded from float, as such amounts are not included in earnings in the Consolidated Statements of Earnings.

Current wording

Invested assets of our insurance businesses derive from shareholder capital and net liabilities assumed under insurance contracts or “float.” The major components of float are unpaid losses and loss adjustment expenses, including liabilities under retroactive reinsurance contracts, life, annuity and health benefit liabilities, unearned premiums and certain other liabilities, which are reduced by insurance premiums receivable, reinsurance receivables, deferred charges assumed under retroactive reinsurance contracts and deferred policy acquisition costs. The effect of discount rate changes on long-duration insurance contracts, which are recorded in accumulated other comprehensive income, are excluded from float, as such amounts are not included in earnings in the Consolidated Statements of Earnings.

Previous wording

Float was approximately $176 billion at September 30, 2025 and $171 billion at December 31, 2024. The cost of float is measured as the ratio of pre-tax underwriting earnings to average float balances. Our combined insurance operations generated pre-tax underwriting gains in the first nine months of 2025 and 2024. Therefore, the cost of float was negative in each period.

Current wording

Float was approximately $176.9 billion at March 31, 2026, an increase of approximately $500 million from December 31, 2025. The cost of float is measured as the ratio of pre-tax underwriting earnings to float balances. Our combined insurance operations generated pre-tax underwriting earnings in the first quarter of 2026 and 2025, and the average cost of float was negative in each period.

Previous wording

Operating revenues from consumer products were $2.1 billion in the third quarter of 2025, unchanged from 2024, and $6.1 billion in the first nine months, a decrease of 1.4% from 2024. The revenues in 2025 reflected lower average revenue per car/unit, substantially offset by slightly higher volumes. Volumes increased 2.2% in the third quarter and 3.7% in the first nine months of 2025 compared to 2024. The volume increases were primarily due to higher intermodal shipments resulting from higher West Coast imports and an increase in automotive vehicle volumes.

Current wording

Operating revenues from consumer products were $2.0 billion in the first quarter of 2026, a slight increase from 2025. Revenues in 2026 reflected lower average revenue per car/unit, offset by slightly higher volume of 1.4% compared to 2025. The volume increase was primarily due to higher international intermodal shipments.

Previous wording

Berkshire Hathaway Energy Company (“BHE”) is a holding company with subsidiaries that primarily operate within the energy industry. BHE’s domestic regulated utility interests include PacifiCorp, MidAmerican Energy Company (“MEC”) and NV Energy. BHE’s natural gas pipelines consist of five domestic regulated interstate natural gas pipeline systems and a 75% interest in a liquefied natural gas export, import and storage facility (“Cove Point”). Other energy subsidiaries operate two regulated electricity distribution businesses in Great Britain (“Northern Powergrid”), a regulated electricity transmission-only business in Alberta, Canada, and a diversified portfolio of mostly renewable independent power projects and investments. Another BHE subsidiary, HomeServices of America, Inc. (“HomeServices”), operates a residential real estate brokerage business and a large network of real estate brokerage franchises in the United States.

Current wording

Berkshire Hathaway Energy Company (“BHE”) is a holding company with subsidiaries that primarily operate within the energy industry. BHE’s domestic regulated utility interests include PacifiCorp, MidAmerican Energy Company (“MEC”) and NV Energy. BHE’s natural gas pipelines consist of five domestic regulated interstate natural gas pipeline systems and a 75% interest in a liquefied natural gas export, import and storage facility. Other energy subsidiaries operate two regulated electricity distribution businesses in Great Britain (“Northern Powergrid”), a regulated electricity transmission-only business in Alberta, Canada, and a diversified portfolio of mostly renewable power projects and investments. Another BHE subsidiary, HomeServices of America, Inc. (“HomeServices”), operates a residential real estate brokerage business and a residential real estate brokerage franchise business in the United States.

Previous wording

BHE’s income tax benefit and net earnings include significant production tax credits primarily from wind-powered electricity generation. On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted, introducing substantial revisions to energy-related U.S. Federal tax policy. Among its provisions, the OBBBA accelerates the phase-out of clean electricity production and investment tax credits and establishes new sourcing requirements applicable to facilities commencing construction after December 31, 2025.

Current wording

*Includes significant production tax credits primarily from wind-powered electricity generation.

Previous wording

The U.S. utilities operate independently in several states, including Utah, Oregon, Wyoming and other Western states (PacifiCorp), Iowa and Illinois (MEC) and Nevada (NV Energy). Net earnings decreased $76 million (8.2%) in the third quarter and increased $143 million (9.1%) in the first nine months of 2025 compared to 2024. Pre-tax Wildfire loss accruals, net of expected insurance recoveries, at PacifiCorp were $100 million in the third quarter and first nine months of 2025 and were $251 million in the first nine months of 2024. See Note 22 to the accompanying Consolidated Financial Statements for additional information on the Wildfires. Otherwise, net earnings of the U.S. utilities in the third quarter and the first nine months of 2025 reflected comparative increases in electric utility margin, substantially offset by an increase in energy operating expenses and lower other income and income tax benefits.

Current wording

The U.S. utilities operate independently in several states, including Utah, Oregon, Wyoming and other Western states (PacifiCorp), Iowa and Illinois (MEC) and Nevada (NV Energy). Net earnings decreased $69 million in the first quarter of 2026 compared to 2025, reflecting comparative increases in energy operating expenses and interest expense and lower income tax benefits from recognized production tax credits, partially offset by increases in electric utility margin and other income.

Previous wording

The U.S. utilities’ electric utility margin was $2.6 billion in the third quarter and $6.6 billion in the first nine months of 2025, increases of $163 million (6.8%) and $593 million (9.9%), respectively, compared to 2024. The increases reflected higher retail customer rates in certain territories, higher retail customer volumes and higher wholesale prices and volumes, partially offset by higher energy cost of sales. Retail customer volumes increased 2.7% overall (up 9.8% at MEC, 2.0% at PacifiCorp and down 1.8% at NV Energy) in the first nine months of 2025 compared to 2024, primarily due to higher customer usage and an increase in the average number of customers, partially offset by an overall unfavorable impact of weather. The increase in energy operating expenses was primarily due to higher depreciation and amortization expense, insurance expenses and general and plant maintenance costs.

Current wording

The U.S. utilities’ electric utility margin was $2.0 billion in the first quarter of 2026, an increase of $47 million (2.4%) compared to 2025. The increase reflected higher retail customer rates in certain territories, lower thermal generation cost of sales and higher wholesale prices, partially offset by higher purchased electricity cost of sales. Retail customer volumes increased 1.7% overall (up 4.4% at MEC and 4.3% at NV Energy and down 1.2% at PacifiCorp) in the first quarter of 2026 compared to 2025, primarily due to an increase in the average number of customers and higher customer usage, partially offset by an overall unfavorable impact of weather. The increase in energy operating expenses was primarily due to vegetation management and other wildfire prevention costs, general and plant maintenance costs, insurance expenses and technology costs.

Previous wording

Net earnings of other energy businesses decreased $99 million in the third quarter and $110 million in the first nine months of 2025 compared to 2024. The decreases were primarily due to lower earnings at Northern Powergrid, from lower distribution revenues due to lower tariffs from inflation adjustments beginning in the second quarter of 2025, deferred income tax charges related to the March 2025 enactment of a change in the United Kingdom’s Energy Profits Levy income tax and higher operating expenses at the distribution businesses, partially offset by favorable income tax expense from higher utilization of tax losses from upstream gas exploration and production activities.

Current wording

Net earnings of other energy businesses decreased $92 million in the first quarter of 2026 compared to 2025. The decrease was primarily due to lower earnings at Northern Powergrid from lower distribution revenues due to lower tariffs from inflation adjustments beginning in the second quarter of 2025 and higher interest expense.

Previous wording

Excludes certain acquisition accounting expenses, which primarily relate to the amortization of intangible assets recorded in connection with certain of our business acquisitions. The after-tax acquisition accounting expenses excluded from earnings were $123 million in the third quarter and $371 million in the first nine months of 2025 and $127 million in the third quarter and $389 million in the first nine months of 2024. These expenses are included in “Other” in the summary of earnings on page 34 and in the “Other” earnings table on page 49.

Current wording

Excludes certain acquisition accounting expenses, which primarily relate to the amortization of intangible assets recorded in connection with certain of our business acquisitions. The after-tax acquisition accounting expenses excluded from earnings were $114 million in the first quarter of 2026 and $124 million in the first quarter of 2025. These expenses are included in “Other” in the summary of earnings on page 29 and in the “Other” earnings table on page 43.

Previous wording

The industrial products group includes complex metal components and products for aerospace, power and general industrial markets (Precision Castparts Corp. (“PCC”)), specialty chemicals (The Lubrizol Corporation (“Lubrizol”)), metal cutting tools/systems (IMC International Metalworking Companies (“IMC”)), and Marmon Holdings, Inc. (“Marmon”), which consists of more than 100 autonomous manufacturing and service businesses, internally aggregated into twelve groups, and includes equipment leasing for the rail, intermodal tank container and mobile crane industries. The industrial products group also includes equipment and systems for the livestock and agricultural industries (CTB International), drag reducing agents for pipelines (LiquidPower Specialty Products), a structural steel fabrication products business (W&W|AFCO) and beginning in August 2025, a manufacturer of rodent control products (Bell Laboratories).

Current wording

The industrial products group includes complex metal components and products for aerospace, power and general industrial markets (Precision Castparts Corp. (PCC)), specialty chemicals (The Lubrizol Corporation (Lubrizol)), metal cutting tools/systems (IMC International Metalworking Companies (IMC)), and Marmon Holdings, Inc. (Marmon) which consists of numerous autonomous manufacturing, service and leasing businesses, currently aggregated in twelve groups. Other industrial products members also produce equipment and systems for the livestock and agricultural industries (CTB International), drag reducing agents for pipelines (LiquidPower Specialty Products), structural steel fabrication products (W&W|AFCO) and beginning in August 2025, rodent control products (Bell Laboratories). On January 2, 2026, Berkshire acquired a chemicals business (OxyChem) from Occidental Petroleum Corporation. OxyChem produces basic chemicals and its results are included in Berkshire’s consolidated results beginning as of the acquisition date.

Previous wording

Revenues of the industrial products group were $9.5 billion in the third quarter and $28.1 billion in the first nine months of 2025, increases of $515 million (5.8%) and $960 million (3.5%), respectively, compared to the same periods in 2024. Pre-tax earnings increased $362 million (24.3%) in the third quarter and $550 million (11.7%) in the first nine months of 2025 compared to 2024. Pre-tax earnings as a percentage of revenues for the group were 18.7% for the first nine months of 2025, an increase of 1.3 percentage points compared to 2024.

Current wording

Revenues of the industrial products group were $11.2 billion in the first quarter of 2026, an increase of $2.1 billion (23.6%) over 2025, primarily attributable to business acquisitions, as well as increases at several of our pre-existing businesses. Pre-tax earnings in the first quarter of 2026 increased $350 million (22.1%) compared to 2025. Pre-tax earnings as a percentage of revenues for the group were 17.2% for the first quarter of 2026, a decrease of 0.3 percentage points compared to 2025.

Previous wording

PCC’s revenues were $2.7 billion in the third quarter and $8.1 billion in the first nine months of 2025, increases of 4.5% in the third quarter and 4.9% in the first nine months compared to 2024. Revenues from aerospace products in the first nine months of 2025 increased 8.5% from 2024. Revenues from power products in oil and gas markets and general industrial products declined. PCC’s pre-tax earnings increased 35.6% in the third quarter and 37.6% in the first nine months of 2025 compared to 2024. The earnings increases reflected the aerospace sales increases and improved manufacturing and operating efficiencies. Earnings in the third quarter and first nine months of 2025 also included insurance recoveries associated with a fire at a fasteners facility that occurred in the first quarter of 2025, which mitigated the earnings impact from the fire.

Current wording

PCC’s revenues were $2.9 billion in the first quarter of 2026, an increase of 8.2% compared to 2025. Revenues from aerospace and industrial gas turbine power products in the first quarter of 2026 increased 9.4% and 18.9%, respectively, over 2025, primarily attributable to strong customer demand and higher prices, due in part to rising costs of certain raw materials. Revenues from other products in the first quarter of 2026 declined 7.5% compared to 2025. PCC’s pre-tax earnings increased 32.9% in the first quarter of 2026 compared to 2025, which included costs and expenses associated with a fire at a fasteners facility in the first quarter of 2025. Additionally, the earnings increase in 2026 reflected aerospace and industrial gas turbine sales growth, improved manufacturing and operating efficiencies and favorable changes in business mix. Future sales and earnings growth will depend on successfully increasing production and expanding capacity, as necessary, to meet customer demand.

Previous wording

IMC’s revenues were $1.0 billion in the third quarter and $3.0 billion in the first nine months of 2025, increases of 7.9% and 2.1%, respectively, over the corresponding 2024 periods. The comparative increases in revenues were primarily attributable to price increases due to higher raw materials costs and the impact of business acquisitions, partially offset by lower sales across many regions, attributable to sluggish customer demand. IMC’s pre-tax earnings increased 21.9% in the third quarter, largely attributable to an increase in investment and other income, and declined 5.1% in the first nine months of 2025 compared to 2024. Earnings in the first nine months of 2025 were negatively impacted by lower gross margin rates from higher raw materials costs and unfavorable manufacturing variances and changes in product mix and increased selling, general and administrative expenses, partially offset by higher investment and other income. IMC operates globally, and a large portion of its products are manufactured in Israel. IMC’s operations in Israel have not been significantly impacted by the conflicts in the region.

Current wording

IMC’s revenues were approximately $1.2 billion in the first quarter of 2026, an increase of 20.6% compared to 2025. IMC has experienced significant raw material price increases, which began in 2025 and continued through the first quarter of 2026. Customer demand and product sales increased in the first quarter of 2026, primarily attributable to customers accelerating purchases. IMC’s pre-tax earnings in the first quarter of 2026 increased 41.9% compared to 2025, reflecting the increases in sales and gross margins, as well as favorable fixed manufacturing cost absorption and product sales mix, partially offset by higher raw materials costs and selling expenses. The significant increase in earnings in the first quarter is not expected to continue throughout 2026. IMC operates globally, and a large portion of its products are manufactured in Israel. IMC’s operations in Israel have not been significantly impacted by the conflicts in the region.

Previous wording

The building products group includes manufactured and site-built home construction and related lending and financial services (Clayton Homes). Other building products businesses include: flooring (Shaw), insulation, roofing and engineered products (Johns Manville), bricks and masonry products (Acme Brick), paint and coatings (Benjamin Moore) and residential and commercial construction and engineering products and systems (MiTek).

Current wording

The building products group includes manufactured (factory-built) and site-built home construction and related lending and financial services (Clayton Homes). Other building products businesses currently include flooring (Shaw), insulation, roofing and engineered products (Johns Manville), paint and coatings (Benjamin Moore) and residential and commercial construction and engineering products and systems (MiTek).

Previous wording

Revenues of the building products group increased $94 million (1.4%) in the third quarter and $220 million (1.1%) in the first nine months of 2025 compared to 2024. Pre-tax earnings of the group increased $81 million (7.6%) in the third quarter and declined $76 million (2.4%) in the first nine months of 2025 compared to 2024. Certain of our building products businesses are experiencing slowing customer demand, as well as pricing pressures, attributable to prevailing general economic conditions and residential housing markets.

Current wording

Revenues of the building products group declined $179 million (2.9%) and pre-tax earnings declined $81 million (9.2%) in the first quarter of 2026 compared to 2025. Certain of our building products businesses experienced lower customer demand, attributable to prevailing general economic conditions and the adverse weather in parts of the U.S. in the first quarter of 2026.

Previous wording

Clayton Homes’ revenues increased 2.7% to $3.3 billion in the third quarter and 5.0% to $9.6 billion in the first nine months of 2025 compared to 2024. Revenues from home sales were essentially unchanged in the third quarter and increased $136 million (2.0%) in the first nine months of 2025 compared to the 2024 periods. New home unit sales were flat in the third quarter and increased 1.8% in the first nine months of 2025 compared to 2024. Financial services revenues increased 12.0% in the third quarter and 13.6% in the first nine months of 2025 compared to 2024, primarily due to increased interest income from higher average loan balances and average interest rates. Loan balances, net of allowances for credit losses, were approximately $28.9 billion as of September 30, 2025, an increase of 9.4% since September 30, 2024. Loan portfolio balances are largely funded by borrowings from Berkshire finance affiliates.

Current wording

Clayton Homes’ revenues were $2.9 billion in the first quarter of 2026, a decline of 1.2% compared to 2025. Revenues from home sales declined $103 million (4.9%) in 2026 versus 2025, reflecting a 9.7% decline in new home unit sales, partially offset by higher average prices for factory-built homes and changes in sales mix. Financial services revenues increased 9.6% in the first quarter of 2026 compared to 2025, primarily due to increased interest income from higher average loan balances and average interest rates. Loan balances, net of allowances for credit losses, were approximately $29.8 billion as of March 31, 2026, an increase of 7.8% since March 31, 2025. Loan portfolios are largely funded by borrowings from Berkshire finance affiliates.

Previous wording

Pre-tax earnings of Clayton Homes increased $74 million (16.0%) in the third quarter and $40 million (2.8%) in the first nine months of 2025 compared to 2024, primarily attributable to increased earnings from financial services, partially offset by lower earnings from home building activities. The increases in financial services earnings were primarily due to lower insurance claims and higher interest income, partially offset by increases in interest expense on borrowings from Berkshire finance affiliates. Interest expense increased $252 million in the first nine months of 2025 versus 2024, largely attributable to increased borrowings. The corresponding interest income on such borrowings is included in the “Other” earnings section on page 49.

Current wording

Clayton Homes’ pre-tax earnings were $393 million in the first quarter of 2026, a decrease of 8.7% from 2025. The decline reflected lower earnings from home building, partially offset by increased earnings from financial services. The decline in home building earnings was due to lower sales volume and slightly higher selling general and administrative expenses. The increase in financial services earnings was primarily due to higher interest income and lower insurance claims expense, partially offset by increased interest expense on increased borrowings from affiliates. The corresponding interest income from these borrowings is included in the “Other” earnings section on page 43.

Previous wording

Consumer products group revenues declined $237 million (6.2%) in the third quarter and $442 million (4.0%) in the first nine months of 2025 compared to 2024. The revenue declines in 2025 were primarily due to Fruit of the Loom, Jazwares and Duracell, largely attributable to lower sales volumes. These declines were partially offset by revenue increases at Brooks Sports, Forest River and Richline, attributable to combinations of higher volumes, changes in sales mix and/or higher prices from higher materials and input costs.

Current wording

Consumer products group revenues were $3.5 billion in the first quarter of 2026, a decline of 1.5% compared to 2025. The decline was driven by revenue reductions at Fruit of the Loom, Garan, Jazwares and Forest River, attributable to a combination of lower sales volumes, unfavorable changes in sales mix and the impacts of exiting unprofitable lines of business at Fruit of the Loom, partially offset by higher average selling prices. Revenue increases were generated by Brooks Sports and Duracell, attributable to combinations of higher volumes, changes in sales mix and/or favorable foreign currency translation effects.

Previous wording

Our service businesses include NetJets and FlightSafety (aviation services), which offer shared ownership programs for general aviation aircraft and high technology training products and services to operators of aircraft, and TTI, a distributor of electronics components. Our other service businesses franchise and service a network of quick service restaurants (Dairy Queen), lease transportation equipment (XTRA) and furniture (CORT), provide third party logistics services that primarily serve the petroleum and chemical industries (Charter Brokerage), distribute electronic news, multimedia and regulatory filings (Business Wire), provide various facilities engineering and construction management services (IPS-Integrated Project Services, LLC (IPS)) and operate a television station in Miami, Florida (WPLG). McLane, which we view as a service business, is addressed separately, since it is deemed a separate segment for financial reporting purposes.

Current wording

Our service group includes NetJets and FlightSafety (aviation services), which offer shared ownership programs for general aviation aircraft and high technology training products and services to operators of aircraft, and TTI, a distributor of electronics components. Our other service businesses franchise and service a network of quick service restaurants (Dairy Queen), lease transportation equipment (XTRA) and furniture (CORT), provide third party logistics services that primarily serve the petroleum and chemical industries (Charter Brokerage), distribute electronic news, multimedia and regulatory filings (Business Wire), provide various facilities engineering and construction management services (IPS-Integrated Project Services, LLC (IPS)) and operate a television station in Miami, Florida (WPLG). McLane, which we view as a service business, is addressed separately since it is deemed a separate segment for financial reporting purposes.

Previous wording

Service group revenues increased $622 million (12.1%) in the third quarter and $1.4 billion (9.2%) in the first nine months of 2025 compared to 2024. The revenue increases in each period were primarily attributable to higher revenues from aviation services (9.7% year-to-date), IPS (23.9% year-to-date) and TTI (7.9% year-to-date). The revenue increases from aviation services reflected increases in the number of aircraft in shared aircraft ownership programs and in-flight hours across NetJets’ various programs and higher average rates. The increases at TTI reflected higher customer demand in certain geographic regions. The increases at IPS were attributable to revenues from life sciences and data center design, construction management and other construction consulting services.

Current wording

Service group revenues increased $941 million (17.1%) in the first quarter of 2026 compared to 2025. The revenues increase was primarily attributable to higher revenues from TTI (26.2%), aviation services (11.8%) and IPS (23.7%). The revenue increase at TTI reflected accelerating customer demand, favorable foreign currency translation effects and inventory cost-based price increases. The increase in demand, in part, was attributed to customers responding to potential further price increases and supply chain concerns, including extended inventory order lead times. The revenue increase from aviation services was primarily due to an increase in the number of aircraft in shared ownership programs and in-flight hours flown and higher average rates. The revenue increase at IPS was attributable to life sciences and data center design, construction management and other construction consulting services.

Previous wording

Service group pre-tax earnings increased $109 million (19.2%) in the third quarter and $262 million (14.6%) in the first nine months of 2025 compared to 2024, primarily attributable to increases from aviation services and TTI. Pre-tax earnings as a percentage of revenues rose 0.5 percentage points in the first nine months of 2025 compared to 2024. The earnings increases from aviation services were primarily attributable to increased revenues, partially offset by higher flight crew and instructor costs and higher maintenance, fuel, and depreciation expenses. TTI’s earnings increases reflected increases in revenues and lower selling general and administrative expenses, as percentages of revenues, partially offset by lower gross margin rates.

Current wording

Service group pre-tax earnings increased $137 million (21.1%) in the first quarter of 2026 compared to 2025, primarily attributable to TTI and, to a lesser extent, aviation services. Pre-tax earnings as a percentage of revenues rose 0.4 percentage points in the first quarter of 2026 compared to 2025. The earnings increase from TTI reflected the increase in revenues, favorable foreign currency translation effects, an increase in the average overall gross margin rate and improved expense leverage. Inventory cost and supply chain uncertainties could result in downward gross margin pressure as the year progresses. The earnings increase from aviation services was primarily attributable to increased revenues, partially offset by higher flight crew and instructor costs and higher maintenance, fuel, subcontract and other variable costs.

Previous wording

McLane operates wholesale distribution businesses that provide grocery and non-food consumer products to retailers and convenience stores (“retail”) and to restaurants (“restaurant”). McLane also operates businesses that are wholesale distributors of distilled spirits, wine and beer (“beverage”). The retail and restaurant businesses generate high sales and very low profit margins and operate in a highly competitive environment. These businesses have several significant customers and a reduction in purchasing by any of these customers could have an adverse impact on McLane’s revenues and earnings.

Current wording

McLane Company, Inc. (“McLane”) operates a wholesale distribution business that provides grocery and non-food consumer products to retailers and convenience stores (“retail”) and to restaurants (“restaurant”). McLane also operates businesses that are wholesale distributors of distilled spirits, wine and beer (“beverage”). McLane’s retail and restaurant businesses generate very high sales volumes and low profit margins.

Previous wording

Our retailing businesses include Berkshire Hathaway Automotive, Inc. (“BHA”), which consists of over 80 auto dealerships that sell new and pre-owned automobiles and offer repair services and related products. BHA also offers and insures vehicle service contracts and related insurance products. Our retailing businesses also include four home furnishings businesses (NFM, R.C. Willey, Star Furniture and Jordan’s), which sell furniture, appliances, flooring and electronics. Other retailing businesses include three jewelry businesses (Borsheims, Helzberg and Ben Bridge), See’s Candies (confectionery products), Pampered Chef (high quality kitchen tools), Oriental Trading Company (party supplies, school supplies and toys and novelties) and Detlev Louis Motorrad (“Louis”), a retailer of motorcycle accessories based in Germany. Pilot Travel Centers (“Pilot”), which is primarily a retail business, is addressed separately since it is deemed a separate segment for financial reporting purposes.

Current wording

Our retailing businesses include Berkshire Hathaway Automotive, Inc. (“BHA”), which consists of over 80 auto dealerships that sell new and pre-owned automobiles and offer repair services and related products. BHA also offers and insures vehicle service contracts and related insurance products. Our retailing businesses also include four home furnishings businesses (NFM, R.C. Willey, Jordan’s and Star Furniture), which sell furniture, appliances, flooring and electronics.

Previous wording

Retailing group aggregate revenues increased 2.7% in the third quarter and 3.5% in the first nine months of 2025 compared to 2024. BHA’s revenues, which represented about 71% of our retailing group’s revenues in 2025, increased 4.0% in the third quarter and 5.5% in the first nine months of 2025 as compared to 2024. The increases reflected a 5.7% year-to-date increase in new and pre-owned vehicle sales revenues, primarily due to increased new units sold, higher average prices and changes in sales mix. BHA’s finance/service contract revenues increased 8.8% in the first nine months of 2025, while parts/service/repair operations revenues increased 2.2% compared to 2024. Revenues of the other retailing businesses declined 0.9% in the first nine months of 2025 versus 2024. Several of our other retailing businesses experienced sluggish customer demand in the first nine months of 2025, attributable to a combination of increased competition and the impacts of higher economic uncertainty and changes in consumer confidence.

Current wording

Aggregate revenues of the other retailing businesses increased 1.3% in the first quarter of 2026 versus 2025. Several of our other retailing businesses continued to experience sluggish customer demand in the first quarter of 2026, attributable to a combination of increased competition and the impacts of higher economic uncertainty and changes in consumer confidence.

Previous wording

Retailing group pre-tax earnings declined $6 million (1.9%) in the third quarter and increased $10 million (1.0%) in the first nine months of 2025 compared to 2024. BHA’s pre-tax earnings increased 1.8% in the third quarter and 3.4% in the first nine months of 2025 compared to 2024, attributable to earnings increases from parts/service/repair and finance/service contract operations, partly offset by lower gross profit margins and higher selling, general and administrative expenses. Aggregate pre-tax earnings for the remainder of our retailing group declined $11 million (22.7%) in the third quarter and $15 million (7.4%) in the first nine months of 2025 compared to 2024.

Current wording

Retailing group pre-tax earnings increased $3 million (1.0%) in the first quarter of 2026 compared to 2025. BHA’s pre-tax earnings increased 3.7% in the first quarter of 2026 compared to 2025, attributable to increased earnings from service contracts operations and lower selling, general and administrative expenses. Aggregate pre-tax earnings for the remainder of our retailing group declined 11.9% in the first quarter of 2026 compared to 2025, attributable to a slight decline in the overall gross margin rate and higher operating expenses.

Previous wording

Pilot operates travel centers, primarily under the names Pilot or Flying J, and fuel-only retail locations. Pilot also operates large wholesale fuel and fuel marketing platforms in the U.S. We acquired the remaining 20% noncontrolling interest in Pilot on January 16, 2024.

Current wording

Pilot Travel Centers (“Pilot”) operates travel centers, primarily under the names Pilot or Flying J, and fuel-only retail locations. Pilot also operates large wholesale fuel and fuel marketing platforms in the U.S. Pilot’s revenues increased $815 million (7.8%) in the first quarter of 2026 compared to 2025. The increase was primarily attributable to higher fuel prices, partially offset by lower fuel volumes.

Previous wording

Pre-tax investment gains and losses included unrealized gains of $20.6 billion in the third quarter and $23.6 billion in the first nine months of 2025 and $18.6 billion in the third quarter and $45.1 billion in the first nine months of 2024, attributable to changes during the period in market prices on equity securities we held at the end of each period. Taxable investment gains and losses on equity securities sold, which is generally the difference between sales proceeds and the original cost basis of the securities sold, were gains of $10.4 billion in the third quarter and $18.7 billion in the first nine months of 2025 compared to gains of $23.4 billion in the third quarter and $97.1 billion in the first nine months of 2024.

Current wording

Substantially all pre-tax investment losses in the first quarter of 2026 and 2025 derived from our investments in equity securities and included net unrealized losses of $3.3 billion and $6.8 billion, respectively, attributable to changes during the period in market prices on equity securities we held at the end of each period. These losses were partially offset by gains of $1.7 billion in the first quarter of 2026 and $371 million in 2025 on securities sold during the period. Taxable investment gains and losses on equity securities sold, which are generally the difference between sales proceeds and the original cost basis of the securities sold, were gains of $7.2 billion in the first quarter of 2026 compared to $3.1 billion in 2025.