Warren Buffett's Last Dance - 2025 Shareholder Letter

Staying True to Value, Acting with Prudence, and Preparing for Transition

In November 2025, legendary investor Warren Buffett released his latest annual shareholder letter, offering insights into Berkshire Hathaway’s business performance, investment philosophy, and future direction. As always, the letter is filled with timeless wisdom — reflecting on past experiences while providing a sharp perspective on the global investment landscape. Below are the key takeaways and investment implications summarized by our firm.

  1. Continued Confidence in the Long-Term Value of Equities

     Buffett reiterated that “the substantial majority of shareholder funds will remain invested in equities,” underscoring his enduring faith in the long-term value of owning high-quality businesses.

• Despite Berkshire’s sizable cash holdings—now amounting to several hundred billion dollars—Buffett explained that this is primarily to await the right opportunities, not a sign of turning defensive. For long-term investors, patience and disciplined timing remain essential to realizing value.

  2. Courage to Correct Mistakes: Action Over Inaction

     In a rare reflection, Buffett revisited early missteps such as Berkshire’s original textile investment, admitting that he “should have acted sooner.” He reminded investors that:“Admitting mistakes and acting promptly protects capital better than delaying indefinitely.”

• This statement captures a core principle of prudent investing — being decisive when an investment thesis no longer holds, rather than confusing caution with inaction.

  3. Leadership Transition: Entering a New Chapter

     Buffett confirmed that he will step down as Chief Executive Officer at the end of 2025, with long-time successor Greg Abel taking over the role. He emphasized the strength of Berkshire’s governance structure and team culture, stating: “Berkshire’s success has never depended on one person, but on discipline and principles.”

• For shareholders, this transition marks the beginning of the “post-Buffett era,” though the firm’s core investment philosophy is expected to remain unchanged.

  4. Warning on Macroeconomic Risks: Fiscal Deficits and Currency Weakness

     On a broader level, Buffett cautioned policymakers against excessive government spending and mounting fiscal deficits. He warned that prolonged reliance on debt and loose monetary policy could weaken the purchasing power of money.

• This reflects Buffett’s long-standing concern that inflation and currency debasement ultimately erode real investment returns.

  5. Expanding Global Exposure: Focus on Asia and Japan

     Buffett noted that Berkshire will continue to increase its exposure to non-U.S. markets, particularly its holdings in Japan’s trading houses. He believes many Asian companies possess stable cash flows and reasonable valuations — well aligned with Berkshire’s value-oriented approach.

• This strategy suggests that global diversification will be a key growth driver for the company moving forward.

  6. Three Key Lessons for Investors

• Think Long Term – Avoid reacting to short-term volatility; focus on businesses that generate sustainable cash flows.
• Maintain Cash Flexibility – Holding cash for the right opportunity reflects discipline, not conservatism.
• Mind the Macro Risks – Consider inflation and currency exposure in portfolio allocation to prevent concentration risk.

Conclusion: Value, Discipline, and Patience Remain the Cornerstones

Even as Buffett prepares to step back from daily leadership, his investment philosophy remains deeply embedded in Berkshire Hathaway’s culture — evaluating businesses through a long-term lens, acting with reason over emotion, and maintaining discipline amid uncertainty.

In an era of market volatility and shifting interest rates, these principles continue to serve as the most reliable compass for investors.