Warren Buffett's Retirement Triggers Berkshire Hathaway Share Decline

Market Reaction to Leadership Change

The retirement of Warren Buffett as CEO of Berkshire Hathaway led to an immediate market reaction, with the conglomerate's shares experiencing a notable decline. On the day Buffett stepped down, Berkshire Hathaway's Class A shares dropped US$600 (0.1%) to close at US$754,800, while Class B shares fell US$1.06 (0.2%) to US$502.65. This decline occurred despite the S&P 500 index also experiencing a 0.7% drop, suggesting that the market reaction was specifically related to Buffett's departure.

Investor Confidence and Historical Performance

The market's response underscores Warren Buffett's significant influence on investor confidence in Berkshire Hathaway. The conglomerate's ability to maintain positive performance has been closely associated with Buffett's leadership. In 2025, Berkshire Hathaway reported a 10.9% profit, demonstrating strong financial performance under Buffett's stewardship. Although the S&P 500 outperformed Berkshire Hathaway in 2025 with a 16.4% gain, Berkshire's long-term track record has been exceptional, with no negative performance years in the past decade.

Future Outlook and Investor Assurance

Despite his retirement from the CEO position, Buffett remains as chairman and has been working to reassure shareholders about Berkshire Hathaway's future prospects. In a special interview with CNBC, Buffett expressed his confidence in the company's long-term viability, stating, "I think this company has a better chance of being around 100 years from now than any company I can think of." This message appears to be part of an effort to mitigate concerns arising from his departure after 60 years at the helm.