Berkshire Hathaway — Business Overview

What does Berkshire Hathaway do?

Berkshire Hathaway is a diversified holding company that owns dozens of large, independently operated businesses across insurance, energy, transportation, manufacturing, and retail. Think of it less like a traditional corporation and more like a collection of wholly owned businesses that happen to share the same parent. The company is run from Omaha, Nebraska by a small corporate staff, with each subsidiary largely left to manage itself — an unusually hands-off approach by corporate standards.

The business spans six broad reporting segments, each significant in its own right:

Berkshire employed approximately 387,800 people worldwide at the end of 2025, with roughly 80% based in the U.S.

How does Berkshire Hathaway make money?

The insurance businesses generate something called "float" — policyholder premiums collected upfront that Berkshire holds and invests before claims are ever paid out. Float has grown from roughly $138 billion at the end of 2020 to approximately $176 billion at the end of 2025. This float, combined with shareholder capital, funds a giant investment portfolio — including a heavily concentrated equity portfolio — that generates substantial investment income. If Berkshire can write insurance profitably (collect more in premiums than it pays in claims and expenses), the float is essentially free money to invest.

Beyond insurance, Berkshire earns operating profits from its industrial businesses. BNSF generates freight revenue from hauling consumer goods, agricultural products, industrial materials, and coal across the western U.S. BHE earns regulated utility returns from selling electricity and natural gas to approximately 5.4 million retail customers and transmitting natural gas through roughly 20,900 miles of pipeline. The manufacturing businesses — ranging from Precision Castparts' aerospace components to Clayton Homes' manufactured housing — each generate their own operating income streams. McLane, the wholesale distribution arm, runs on very thin margins but enormous volume, serving over 43,000 retail locations and 35,000 restaurants across all 50 states.

What market does Berkshire Hathaway operate in?

Because Berkshire operates across so many industries, it is exposed to a wide range of markets, each with its own growth dynamics. The U.S. property and casualty insurance market is mature but large; GEICO held approximately 11.6% of the private passenger auto insurance market in 2024, making it the third-largest insurer in that segment. The reinsurance market is global, competitive, and cyclical based on catastrophe losses and premium pricing. Aerospace manufacturing (Precision Castparts) benefits from long-term secular growth in air travel demand. The utility and energy sector is transitioning toward renewable generation, a trend BHE is actively investing in with $38 billion in cumulative renewable investments through 2025. Freight rail, while facing competition from trucking and other modes, remains essential infrastructure for bulk commodity transport.

A few notable secular trends bear watching across Berkshire's businesses. The shift to electric vehicles is a long-run headwind for GEICO (fewer accidents) and for Lubrizol's engine lubricant additives. Residential housing affordability pressures affect Clayton Homes and the home furnishings retailers. The energy transition creates both capital investment opportunity for BHE and regulatory uncertainty around coal-fired generation. The RV industry, where Forest River holds approximately 36% market share, is highly cyclical.

Who are Berkshire Hathaway's main competitors?

Berkshire competes differently in each of its businesses, but its overarching competitive advantage is financial strength and patient, long-term capital allocation. Its insurance subsidiaries carry a combined U.S. statutory surplus (a measure of financial cushion) of approximately $333 billion and are rated AA+ by Standard & Poor's and A++ by A.M. Best — ratings that allow them to underwrite risks competitors cannot. The sheer scale of float gives Berkshire a structural investment advantage most insurers cannot replicate.

At the business-unit level, the competitive landscape varies widely:

• GEICO competes with State Farm, Progressive, Allstate, and USAA in auto insurance. The top five players together hold about 63.6% of the market.
• BNSF competes primarily with Union Pacific in the western U.S., plus trucking companies and other transport modes.
• BHE faces competition from other regulated utilities in its service territories, though most of its utility businesses have exclusive retail service areas by regulation.
• Precision Castparts competes with other aerospace component manufacturers, with Boeing, Airbus, GE Aerospace, Rolls-Royce, and Pratt & Whitney as its primary customers.
• Forest River (RVs) competes with Thor Industries, which held approximately 39% market share versus Forest River's 36% as of December 2025 — a highly consolidated two-player market.

Where does Berkshire Hathaway operate?

Berkshire is primarily a U.S.-based conglomerate, with approximately 80% of its ~387,800 employees located domestically. Most of its core businesses — BNSF rail, BHE utilities, GEICO, Clayton Homes, McLane, and the retail chains — operate entirely or almost entirely within the United States. BNSF's rail network covers the western and southern U.S., with some access into Canada and Mexico.

Several subsidiaries have meaningful international footprints. Berkshire Hathaway Reinsurance Group (BHRG) conducts business in 23 countries, with General Re's international reinsurance operations centered in Cologne, Germany, and Lloyd's of London. BHE owns electricity distribution networks in the U.K. (Northern Powergrid, serving about 4 million customers in northeast England) and a regulated transmission utility in Alberta, Canada (AltaLink). Lubrizol operates across more than 100 facilities on six continents. IMC (metal cutting tools) manufactures in Israel, the U.S., South Korea, Japan, Germany, Italy, and several other countries. Marmon operates across approximately 630 facilities in the U.S. and 19 other countries. The newly acquired OxyChem operates primarily in the U.S., with two international sites in Canada and Chile.