Berkshire Hathaway Stock: Underperformance vs. S&P 500 Index

Berkshire Hathaway's (BRKB) B shares achieved a 13% annual compounded return over the ten years ending August 25, 2026, transforming a $10,000 investment into approximately $33,900. While a significant return, this performance fell short of the SPDR S&P 500 ETF Trust (SPY), which delivered a 15% annual return over the same period, turning a similar investment into about $41,300. The divergence is largely attributed to the S&P 500's exposure to high-growth technology and AI sectors, areas where Berkshire's operating businesses have less direct involvement. Berkshire's growth stemmed from expanding its own operations and share buybacks, leading to nearly tripled per-share earnings despite a 13% reduction in outstanding shares. Operating earnings grew from $17.6 billion in 2016 to $44.5 billion in 2025, bolstered by an increase in insurance float from $91.6 billion to $177.5 billion. Despite a dip in 2025 earnings from the prior year, the first half of 2026 showed a 17% increase year-over-year, with key segments like BNSF railroad and energy operations showing robust growth.

### Story Arc / How We Got Here

This follows our earlier coverage ([Berkshire Hathaway Scales Back Bank of America Stake, Boosts Delta](/explore/ceo-desk-berkshire-hathaway-scales-back-bank-of-america-stake-boosts-delta)) on 2026-08-21. Berkshire Hathaway, under CEO Greg Abel, reduced its stake in Bank of America by approximately 5.9%, a move worth about $1.7 billion. Concurrently, the conglomerate increased its holdings in Delta Air Lines by 44%, adding $1.6 billion. This strategic shift signals a reallocation within Berkshire's substantial U.S. equity portfolio. · * Watch Bank of America for potential price adjustments following a substantial stake reduction by Berkshire Hathaway. * Monitor Delta Air Lines for continued investor interest as Berkshire Hathaway significantly increased its position.