Why has net profit significantly decreased? Berkshire Hathaway (BRK.A.US) 2025 Q1 management discussion and analysis of financial condition and operating results.

Editor's note: In the first quarter of 2025, Berkshire Hathaway's financial performance showed a net profit of $46.03 billion, a significant decrease of 64% compared to the same period last year, mainly due to a decrease in investment income. Revenue was $897.25 billion, essentially flat compared to the previous year. Insurance underwriting revenue reached $1.34 billion, with insurance underwriting profit almost halved due to events like the Southern California wildfires. In terms of stock investments, there was a net loss of $5.038 billion, compared to a profit of $14.8 billion in the same period last year. Equity investments with a total fair value of 69% were concentrated in top five companies such as American Express and Apple, and Berkshire has been selling off stocks for the tenth consecutive quarter. Cash holdings reached a historic high of $347.7 billion as of the end of March, with no stock repurchases conducted in the first quarter and the suspension of stock buyback operations that had been ongoing for six years since the third quarter of 2024. This article is divided into three parts: the company's press release, notes on equity securities investment in the financial report, and management's discussion and analysis of financial condition and operating results for investors' reference. I. Berkshire Hathaway's First Quarter Financial Report Press Release The earnings summary for Berkshire Hathaway and its consolidated subsidiaries for the first quarters of 2025 and 2024 are as follows. Earnings are presented on an after-tax basis. (All dollar amounts are in millions except per share amounts) Generally Accepted Accounting Principles ("GAAP") require us to include unrealized gains/losses on equity investments as part of investment income (loss) in the income statement. In the table above, investment income (loss) includes a loss of approximately $7.4 billion in the first quarter of 2025, and a loss of approximately $9.7 billion in the first quarter of 2024, resulting from changes in unrealized gains on equity investments held in both 2025 and 2024. Investment income (loss) also includes realized gains of $2.4 billion in the first quarter of 2025, and $11.2 billion in the first quarter of 2024. The amount of investment income (loss) in any given quarter is typically not meaningful, and the resulting per share net earnings data may be highly misleading to investors who are not familiar with or do not understand accounting standards. The analysis of Berkshire's operating earnings is as follows (all dollar amounts are in millions): * Includes foreign exchange losses of approximately $713 million in 2025 and foreign exchange gains related to non-U.S. dollar denominated debt of approximately $597 million in 2024. Also includes interest and dividend income related to U.S. Treasuries and other investments not directly held by Berkshire's insurance and non-insurance operating companies of approximately $869 million in 2025 and $303 million in 2024. As of March 31, 2025, the equivalent number of A Class common shares issued was 1,438,223. As of March 31, 2025, insurance float (our net liability under insurance contracts) was approximately $173 billion, having increased by $20 billion since the end of 2024. Use of Non-GAAP Financial Measures This press release includes certain non-GAAP financial measures. The reconciliations of these measures to the most directly comparable GAAP data are included in this document in compliance with Regulation G. Berkshire presents its performance in a manner it believes is most meaningful, useful, and transparent to the public investors and others who use Berkshire's financial information. This presentation includes the use of certain non-GAAP financial measures. In addition to reporting net earnings in accordance with GAAP, Berkshire also presents operating earnings, which are net earnings after excluding investment income (loss). Although investment yield on insurance and reinsurance premiums is included in generating investment income and losses, it is a component of Berkshire's operations independent of the insurance underwriting process. Furthermore, as mentioned earlier, under applicable GAAP accounting requirements, we must include changes in unrealized gains (losses) on equity investments as part of investment income (loss) in the income statement. In summary, investment income (loss) for any particular period does not necessarily reflect quarterly business performance. About Berkshire Berkshire Hathaway and its subsidiaries engage in a variety of business activities, including insurance and reinsurance, railroad freight, utilities and energy, manufacturing services, and retail. The company's common stock is listed on the New York Stock Exchange under the trading symbols BRK.A and BRK.B. Forward-Looking Statements Certain statements in this press release are considered "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance, and actual results may differ significantly from those forecasted. II. Notes on "Equity Securities Investment" in the Financial Report Over the years, our equity securities investments have been concentrated in a relatively small number of companies. As of March 31, 2025, and December 31, 2024, the fair value of our top five holdings represented 69% and 71% of the total fair value of equity securities, respectively. The top five holdings at these two points in time were American Express, Apple, Bank of America, Coca-Cola, and Chevron. Since 2019, we also hold Western Oil Company ("Western Oil") non-voting cumulative preferred shares and common stock warrants. Our holdings of Western Oil preferred shares and common stock warrants are accounted for at fair value and are included in the equity securities in the consolidated balance sheet because, under GAAP, these investments are essentially not common stock. We use the equity method to account for our investment in Western Oil common shares. The Western Oil preferred shares accumulate dividends at an annual rate of 8%, with Western Oil having the option to participate from 2029.Choose to redeem at a redemption price of 105% of the liquidation value. As of March 31, 2025, the total liquidation value of the Western Oil preferred shares we hold is approximately $8.5 billion. So far, we have requested the redemption of approximately $1.5 billion of the total liquidation value of the preferred shares because Western Oil has distributed dividends to common shareholders in excess of the prescribed amount (as defined in the preferred stock certificate).Western Oil common stock warrants allow us to purchase up to 83.86 million shares of Western Oil common stock at an exercise price of $59.62 per share. These warrants can be exercised in whole or in part, and are valid for one year after the redemption of preferred stock. As of March 31, 2025, we hold 151.6 million shares of American Express Company ("American Express") common stock, representing 21.6% of the issued common stock of American Express. Since 1995, we have an agreement with American Express to vote in line with the recommendations of the American Express board for most of our shares. Additionally, we agree to abide by the relevant restrictions of the Federal Reserve Board, which we believe limits our significant influence over American Express's operations and financial policies. Therefore, we account for our investment in American Express common stock at fair value, not using the equity method. Berkshire and its subsidiaries use the equity method for investments in certain entities, most notably our investments in Kraft Heinz Company ("Kraft Heinz") and Western Oil common stock. As of March 31, 2025, we hold 27.3% of the issued common stock of Kraft Heinz and 28.2% of the issued common stock of Western Oil (excluding the potential impact of the exercise of Western Oil common stock warrants). Kraft Heinz produces and sells food and beverage products, including condiments and sauces, cheese and dairy products, meals, meats, snacks, and grocery products like coffee. Western Oil is an international energy company with operations in oil and gas exploration, development, production, and chemical manufacturing. We also hold a 50% interest in Berkadia Commercial Mortgage LLC ("Berkadia"), with Jefferies Financial Group, Inc. ("Jefferies") holding the other 50% interest. Berkadia engages in commercial/multifamily real estate mortgage banking, investment sales, and servicing. Berkadia's commercial note borrowing facilities (with a limit of $1.5 billion) are supported by guarantee policies issued by Berkshire's insurance subsidiaries. Under this policy, Jefferies is obligated to bear fifty percent of any resulting losses. The fair value and carrying amount of these investments are shown in the table below (in millions of US dollars). Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Net income attributable to Berkshire shareholders is shown in the table below (in millions of US dollars, amounts are net of taxes and exclude income from non-controlling interests): Through subsidiaries, we engage in a diverse range of business activities. The business segment data (see Note 24 to the consolidated financial statements and Note 26 in the 2024 annual 10-K) should be read in conjunction with this discussion. Future periods of regular operations may be affected by ongoing macroeconomic and geopolitical events, as well as changes in industry or company-specific factors or events. In 2025, the pace of these events has accelerated, including changes in international trade policies and tariffs. The ultimate outcomes of these events are highly uncertain. We are currently unable to reliably predict the potential impact of these events on our business, whether through changes in product costs, supply chain costs and efficiency, or changes in customer demand for our products and services. It is likely to have an adverse effect on most (if not all) of our operating businesses as well as our equity securities investments, and could significantly affect our future performance. Insurance Underwriting In the first quarter of 2025, insurance underwriting income decreased by $1.3 billion compared to 2024. This performance includes approximately $860 million in after-tax losses from Southern California wildfires in the first quarter of 2025. Insurance investment income, after taxes, increased by $295 million in the first quarter of 2025 compared to 2024, primarily due to higher interest income from US Treasury investments, partially offset by lower dividend income. BNSF Railway In the first quarter of 2025, BNSF's after-tax income increased by 6.2% compared to 2024, benefiting from higher transportation volumes and overall operational efficiency despite adverse weather conditions in February 2025. Berkshire Hathaway Energy (BHE) In the first quarter of 2025, BHE's after-tax income increased by $3.8 billion (53.0%) compared to 2024. The increase in income reflects higher utility and energy business earnings, lower non-controlling interest income, and reduced losses from real estate brokerage business, mainly due to the impact of litigation and settlement expenses in the first quarter of 2024. Manufacturing, Service, and Retail Business In the first quarter of 2025, our manufacturing, service, and retail businesses' after-tax income slightly decreased compared to 2024. The 2025 income reflects overall growth in service and retail business, a decrease in manufacturing business overall. Most of our businesses had lower revenues and income in the first quarter of 2025 compared to the same period in 2024. Investment Income (Loss) Investment income (loss) mainly comes from our equity securities investments, including significant unrealized gains and losses due to market price changes and foreign exchange rate fluctuations applicable to some of our investments. We believe that investment income and losses, whether realized gains from disposals or unrealized gains from market price changes, generally do not have meaningful effects on understanding our periodic performance or evaluating the economic performance of our operating business. These gains and losses have and will continue to cause significant fluctuations in our periodic earnings. Other Income Other income includes corporate investment income, equity method investment income, and foreign exchange gains and losses related to non-US dollar-denominated debt of Berkshire and BHFC. In the first quarter of 2025, after-tax foreign exchange losses were $713 million, compared to gains of $597 million in the first quarter of 2024. InsuranceUnderwritingOur periodic underwriting income may experience significant fluctuations due to the timing and size of major property catastrophe losses events. In addition, we generally do not reinsure the risks we assume. We currently consider a significant loss to be a single event that results in combined pre-tax losses exceeding $150 million. In the first quarter of 2025, we incurred significant losses from wildfires in Southern California, while there were no significant disaster events in the first quarter of 2024. Changes in estimated unpaid losses and loss adjustment expenses, including amounts allocated for events in previous years, as well as foreign exchange gains and losses resulting from the revaluation of non-dollar denominated assets and liabilities, will also significantly impact our periodic underwriting performance. We underwrite primary and reinsurance policies for property and casualty risks, as well as life and health risks. Our insurance and reinsurance operations include GEICO, Berkshire Hathaway Primary Group (BH Primary), and Berkshire Hathaway Reinsurance Group (BHRG). We aim to generate long-term pre-tax underwriting income across all business categories (defined as earned premiums minus incurred insurance losses / benefits and underwriting expenses), excluding retrospective reinsurance and periodic payment annuity business. The time value of money concept is an important consideration when setting premiums for these policies, which are recognized as revenue during the claims settlement period. Below is a summary of the underwriting performance of our insurance business (in millions of US dollars): GEICO GEICO underwrites property and casualty insurance policies in all 50 states and the District of Columbia, primarily private passenger auto insurance. GEICO primarily offers policies through a direct response method, with most customers applying for insurance directly to the company through the internet or phone. GEICO also operates an insurance agency that primarily offers homeowner and renter insurance to its auto policyholders. The following is a summary of GEICO's underwriting performance (in millions of US dollars): In the first quarter of 2025, written premiums increased by $710 million (6.6%) compared to 2024, reflecting an increase in policies in force and an increase in average premiums per policy. Earned premiums increased by $518 million (5.1%) compared to the first quarter of 2024. Losses and loss adjustment expenses increased by $1 million (0.1%) compared to the first quarter of 2024. In the first quarter of 2025, GEICO's loss ratio (losses and loss adjustment expenses as a percentage of earned premiums) was 69.0%, a decrease of 3.5 percentage points from 2024. The decrease in the loss ratio reflects an increase in average premiums per auto policy and a decrease in claims frequency, partly offset by an increase in average claim severity and adverse development in prior accident year claim estimates. In the first quarter of 2025, the frequency of property damage and collision claims for private passenger auto insurance decreased by 6% to 9% compared to 2024, while the frequency of bodily injury claims slightly decreased. Average claim severity increased in property damage and collision insurance (1% to 3%) and bodily injury insurance (6% to 8%) in the first quarter of 2025 compared to 2024. Losses and loss adjustment expenses included a $45 million reduction in final loss estimates for prior accident year claims in the first quarter of 2025, compared to a $155 million reduction in 2024. In the first quarter of 2025, underwriting expenses increased by $263 million compared to 2024. GEICO's expense ratio (underwriting expenses as a percentage of earned premiums) was 10.8% in the first quarter of 2025, an increase of 2.1 percentage points from 2024, attributed to an increase in policy acquisition-related expenses, partly offset by an increase in operating leverage. The revenue from GEICO's insurance agency (third-party commission, net of operating expenses) is included as a reduction in underwriting expenses. Berkshire Hathaway Primary Group (BH Primary) BH Primary consists of multiple independently managed businesses that provide a variety of primary commercial insurance solutions to large, medium, and small customers, including medical professional liability, workers' compensation, auto, general liability, property, and specialty insurance. BH Primary's insurance companies include Berkshire Hathaway Specialty Insurance Company (BHSI), RSUI Group LLC and CapSpecialty LLC (RSUI and CapSpecialty), Berkshire Hathaway Homestate Companies (BHHC), MedPro Group, GUARD Insurance Group LLC (GUARD), National Indemnity Company Primary, Berkshire Hathaway Direct Insurance Company (BH Direct), and United States Liability Insurance Group (USLI). In the first quarter of 2025, written premiums decreased by 1.6% compared to 2024. The main reasons for the decrease were a 34% decrease in GUARD premiums, and a moderate decrease in RSUI premiums, partly offset by increases in premiums for NICO Primary, BHHC, and BH Direct. The decrease in GUARD premiums reflects a reduction in business volumes of multiple product categories due to exiting unprofitable product lines and tightening overall underwriting standards. The decrease in RSUI is mainly due to a decrease in business volumes, partially offset by an increase in renewal business. The growth in NICO Primary and BHHC is mainly attributed to commercial auto business, while the growth in BH Direct reflects growth in multiple business lines and product categories. Losses and loss adjustment expenses increased by $640 million (22.8%), with a loss ratio increasing by 13.5 percentage points compared to the first quarter of 2024. The losses in the first quarter of 2025, including approximately $300 million from wildfires in Southern California. Losses in 2025 also include a $45 million reduction in final loss estimates for prior accident years, compared to a $155 million reduction in 2024.The final estimated increase in losses paid was $212 million, attributed to higher final loss estimates for liability insurance, partially offset by lower final loss estimates for property and medical liability insurance. In the first quarter of 2024, incurred losses estimates for prior accident years decreased by $93 million. Costs for medical professional liability and other liability claims continue to be negatively impacted by unfavorable social inflation trends, including the impact of jury verdicts and litigation expenses.Berkshire Hathaway Reinsurance Group (BHRG) Berkshire Hathaway Reinsurance Group provides excess of loss and proportional reinsurance protection for property and casualty risks to insurance and reinsurance companies globally through various subsidiaries (primarily National Indemnity Company, General Reinsurance Corporation, General Reinsurance AG, and Cross Atlantic China Welding Consumables, Inc.). We also underwrite life and health reinsurance through General Reinsurance Life Company, General Reinsurance AG, and Nebraska Berkshire Hathaway Life Insurance Company. Below is a summary of BHRG's pre-tax underwriting performance (in millions of US dollars): Property/Casualty Reinsurance Below is a summary of the property/casualty reinsurance underwriting performance (in millions of US dollars): In the first quarter of 2025, written premiums decreased by $320 million (5.0%) compared to 2024, primarily due to a decrease in property insurance business volume. Earned premiums decreased by 3.7% compared to the first quarter of 2024. Loss and loss adjustment expenses increased by $606 million (20.2%), with a loss ratio increasing by 13.6 percentage points compared to the first quarter of 2024. Losses from Southern California wildfires accounted for approximately $770 million in the first quarter of 2025. The final liability estimate for prior accident year losses decreased by $330 million in the first quarter of 2025 and $386 million in 2024, mainly due to lower than expected property losses. Underwriting expenses increased by $134 million (9.3%) in the first quarter of 2025, with an expense ratio increasing by 3.6 percentage points compared to 2024. Underwriting expenses include a $142 million foreign exchange loss in the first quarter of 2025 due to a revaluation of certain non-U.S. dollar denominated liabilities, compared to a $26 million gain in 2024. Excluding this, underwriting expenses decreased by 2.3% in 2025 compared to 2024. Insurance Investment Income Below is a summary of net investment income attributable to our insurance businesses (in millions of US dollars): In the first quarter of 2025, interest and other investment income increased by $588 million (30.5%) compared to 2024. This growth was primarily due to an increase in balances of U.S. Treasury securities and other short-term investments, partially offset by lower interest rates. We continue to believe that maintaining adequate liquidity is crucial, and we prioritize safety over returns in short-term investments. Dividend income decreased by $179 million (14.7%) in the first quarter of 2025 compared to 2024. The decrease was primarily due to net dispositions of equity securities, partially offset by higher dividend rates on certain holdings. Dividend income can also vary over different periods due to changes in the investment portfolio and the timing and frequency of dividends from investee companies. The investment assets of our insurance business come from shareholder equity and net Liabilities assumed under insurance contracts (i.e. "float"). The main components of float are unpaid losses and loss adjustment expenses (including liabilities under retroactive reinsurance contracts), life, annuities and health benefit liabilities, unearned premiums, and certain other liabilities, net of accounts receivable for insurance premiums, reinsurance recoverables, deferred charges and deferred policy acquisition costs under retroactive reinsurance contracts. The impact of changes in discount rates for long-term insurance contracts (recorded in other comprehensive income) is not included in float, as those amounts are not recognized as income on the consolidated income statement. As of March 31, 2025, float was approximately $173 billion, compared to $171 billion as of December 31, 2024. The cost of float is measured by the ratio of underwriting income before tax to float balance. Our comprehensive insurance operations generated underwriting income in the first quarter of 2025 and 2024, with average float costs being negative in each period. Below is a summary of cash and investments held by our insurance business (in millions of US dollars): BNSF Railway Burlington Northern Santa Fe, LLC (BNSF) operates one of North America's largest railroad systems, with over 32,500 miles of track in 28 states and operations in three Canadian provinces. BNSF categorizes its core business segments by type of products transported, including consumer products, agricultural and energy products, industrial products, and coal. Below is a summary of BNSF's revenues (in millions of US dollars): Below is a summary of railroad freight volumes by business segment for BNSF (in thousands of cars/units): In the first quarter of 2025, railroad operating revenue slightly increased compared to 2024, primarily due to a 4.1% increase in unit volume and core pricing increases, partially offset by a decrease in average revenue per car/unit (due to lower fuel surcharge income and an unfavorable mix of business). Pre-tax income increased by 5.5% compared to the first quarter of 2024. In the first quarter of 2025, consumer products operating revenue was $2 billion, increasing by 3.2% compared to 2024, reflecting an 8.6% increase in volume but partially offset by a decrease in average revenue per car/unit. The increase in volume was mainly driven by an increase in intermodal shipments due to higher imports on the West Coast and increased automotive shipments driven by higher production levels. Agricultural and energy products operating revenue in the first quarter of 2025 was $1.6 billion, increasing by 0.8% compared to 2024, attributed to an increase in average revenue per car/unit, partially offset by a slight decrease in volume. The slight decrease in volume was mainly due to reduced domestic grain shipments. Industrial products operating revenue in the first quarter of 2025 was $1.2 billion, decreasing by 3.3% compared to 2024. The decrease was attributed to a 5.9% decrease in volume, partially offset by an increase in average revenue per car/unit. The decrease in volume was mainly due to weather-related impacts andDecrease in demand for construction and building products.Coal operating revenue in the first quarter of 2025 was $7.34 billion, a 4.1% decrease from 2024, reflecting a decrease in average income per car/unit, but partially offset by a 1.7% increase in transportation volume due to increased demand caused by rising natural gas prices. In the first quarter of 2025, railway operating expenses decreased by $66 million (1.7%) from 2024. Fuel costs decreased by $84 million (9.8%) from the first quarter of 2024, reflecting a decrease in average fuel prices, partially offset by an increase in transportation volume. Purchased services costs increased by $34 million (6.9%) from the first quarter of 2024, primarily due to increased costs related to transportation volume, investments in cargo security, and general inflation. Financial Condition Our consolidated balance sheet continues to reflect significant liquidity and a very strong capital base. As of March 31, 2025, Berkshire's shareholders' equity was $654.5 billion, an increase of $5.1 billion from December 31, 2024. In the first quarter of 2025, net earnings attributable to Berkshire shareholders were $4.6 billion, including approximately $5 billion in after-tax investment losses. Changes in market prices of our equity securities investments typically result in significant fluctuations in our earnings. Berkshire's common stock repurchase program allows Berkshire to repurchase its Class A and Class B shares at prices below the company's intrinsic value, as determined conservatively by Chairman and CEO Warren Buffett. We have no minimum repurchase amount commitment or maximum repurchase amount limit. If repurchases result in our total cash, cash equivalents, and U.S. Treasury holdings falling below $30 billion, we will not repurchase shares. Financial strength and surplus liquidity are crucial for Berkshire. No stock repurchases were made in the first quarter of 2025. As of March 31, 2025, our insurance and other businesses held cash, cash equivalents, and U.S. Treasuries (net of unsettled purchase obligations) of $328 billion. Equity and fixed maturity securities investments (excluding equity method investments) totaled $278.8 billion. As of March 31, 2025, our consolidated borrowings totalled $125.9 billion, with over 95% issued by Berkshire and its subsidiaries BHFC, BNSF, and BHE. Berkshire's outstanding debt was $20.6 billion as of March 31, 2025, a decrease of approximately $500 million from December 31, 2024. In the first quarter of 2025, Berkshire repaid approximately $1.3 billion of maturing debt. Additionally, due to changes in foreign exchange rates, the book value of Berkshire's non-U.S. dollar-denominated debt increased by $809 million in the first quarter of 2025. BHFC's senior notes borrowings were approximately $18 billion as of March 31, 2025, essentially unchanged from December 31, 2024. BHFC's borrowings are used to provide funding for loans originated and acquired by Clayton Homes and to fund a portion of the equipment held by our railcar leasing business. Berkshire guarantees the full payment of principal and interest on BHFC's senior notes. As of March 31, 2025, and December 31, 2024, BNSF had outstanding debt of $23.5 billion. BHE's total borrowings were approximately $58 billion as of March 31, 2025, an increase of $1.6 billion from December 31, 2024. In the first quarter of 2025, BHE's subsidiaries issued $2.4 billion of term debt, with a weighted average interest rate of 6.5%, maturing from 2035 to 2055. BHE and its subsidiaries repaid approximately $890 million of term debt and short-term borrowings. Berkshire does not guarantee the repayment of debt issued by BNSF, BHE, or any of its subsidiaries or affiliates. In the first quarter of 2025, our diversified business group generated $10.9 billion in net operating cash flow. In the first quarter of 2025, our combined capital expenditures for property, plants, and equipment, as well as leasehold equipment, were $4.3 billion, including $2.8 billion for BNSF and BHE. BNSF and BHE maintain significant investments in capital assets (property, plants, and equipment) and regularly undertake significant capital expenditures as part of normal business operations. BHE and BNSF are estimated to have approximately $11.9 billion in remaining planned capital expenditures for the remainder of 2025. Key Accounting Estimates Certain accounting policies require us to make estimates and judgments in determining the amounts reflected in our consolidated financial statements. These estimates and judgments involve varying degrees of uncertainty and can sometimes be significant. Therefore, certain amounts currently recorded in our consolidated financial statements may be adjusted in the future as new information becomes available and other facts and circumstances change. Refer to the "Critical Accounting Estimates" section in Berkshire's annual 10-K report as of December 31, 2024, for a discussion of key accounting estimates. As of March 31, 2025, our consolidated balance sheet includes estimated liabilities of $149.1 billion for unpaid losses and loss adjustment expenses related to property and casualty insurance and reinsurance contracts. Due to inherent uncertainty in establishing these liabilities, the actual ultimate claim amounts could differ from the amounts currently recorded. Even small percentage changes in estimates of this magnitude could have a significant impact on periodic earnings. The impact of changes in these estimates is recorded as incurred in insurance losses and loss adjustment expenses.Adjusting fees.As of March 31, 2025, our consolidated balance sheet includes goodwill of $84 billion and indefinite-lived intangible assets of $18.9 billion from acquisition transactions. In the annual goodwill impairment test conducted in the fourth quarter of 2024, the estimated fair value of our seven reporting units did not exceed their carrying amounts by at least 20%, as disclosed in the annual 10-K report as of December 31, 2024. At that time, the estimated total fair value of these units was approximately $65.6 billion, exceeding our total carrying amount of $57.4 billion. The total goodwill of these reporting units was approximately $18.6 billion. Goodwill and indefinite-lived intangible assets impairment testing involve determining the estimated fair value of reporting units and indefinite-lived intangible assets. Various methods and inputs may be used to estimate fair value, and significant judgments are required when making such estimates. Due to the inherent subjectivity and uncertainty in forecasting future cash flows and earnings over the long term, actual results may differ significantly from forecasts. As of March 31, 2025, we concluded that the goodwill and other indefinite-lived intangible assets recorded in our consolidated balance sheet are unlikely to be impaired. However, the estimated fair value of reporting units and assets may change based on market and economic conditions as well as events affecting our business, and we cannot reliably predict such changes. Under these circumstances, it is reasonable to expect that adverse changes in such conditions or events could lead to future impairment losses being recognized in our consolidated financial statements. Forward-Looking Statements Investors should note that certain statements in this document, as well as periodic news releases from Berkshire officials and certain oral statements made in presentations about Berkshire or its subsidiaries, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include predictive statements that rely on or involve future events or conditions, or include statements containing words such as "expects," "anticipates," "intends," "plans," "believes," "estimates," or similar expressions. Additionally, any statements made by management regarding future financial performance (including future revenue, earnings, or growth rates), ongoing business strategies or prospects, and future actions Berkshire may take fall under the definition of forward-looking statements as defined by the Act. Forward-looking statements are based on current expectations and forecasts of future events, subject to risks, uncertainties, and assumptions about Berkshire and its subsidiaries, economic and market factors, and the industries in which we operate. These statements are not guarantees of future performance, and we do not have specific intentions to update these statements. Actual events and results may differ significantly from the expressed or forecasted content of forward-looking statements due to various factors. Key risk factors that may cause significant differences between our actual performance and future events and actions and those expressed in these forward-looking statements include, but are not limited to: changes in market prices of our equity investments; the occurrence of one or more catastrophic events such as earthquakes, hurricanes, geopolitical conflicts, terrorist acts, or cyber attacks, resulting in losses for our insurance subsidiaries and/or operational losses; the frequency and severity of epidemics, pandemics, or other outbreaks, and other events that negatively impact our operational performance and limit our ability to obtain borrowing at reasonable rates through capital markets; changes in laws or regulations affecting our insurance, railroad, utility, energy and finance subsidiaries; changes in federal income tax laws; and changes in general economic and market factors affecting securities prices or our industry. The content of this article is sourced from the official Berkshire website; GMTEight editorial: Wenwen.