Berkshire Hathaway CEO Greg Abel addressed a question about selling businesses or a possible breakup in his first annual general meeting after replacing Warren Buffett in January.

Its businesses range from a host of insurance companies, including Geico, to railways, Benjamin Moore paints, Dairy Queen, significant holdings in Apple, Bank of America, and American Express, and, of course, NetJets, the world’s largest private jet operator.

Buffett had served as CEO for 60 years.

The Oracle of Omaha had announced his retirement at last year’s annual meeting.

Berkshire Hathaway Q1 Results

Its first-quarter results, reported before today’s meeting in Omaha, Nebraska, showed it has nearly $400 billion in cash and cash equivalents.

Service group, which includes NetJets, saw revenues jump by $941 million, good for a 17.1% gain.

Aviation services saw an 11.8% increase.

The revenue increase from aviation services was “primarily due to an increase in the number of aircraft in shared ownership programs and in-flight hours flown and higher average rates.”

READ: Berkshire Hathaway execs see no let-up in demand at NetJets

NetJets Turnaround

The turnaround at NetJets, following years of losses, and the appointment of its Chairman and CEO, Adam Johnson, as president of the conglomerate’s consumer products, highlighted Abel’s first AGM.

Buffett and the late Charlie Munger, vice chairman of Berkshire Hathaway, had praised Johnson during the 2023 annual meeting.

They recalled how NetJets had moved from a $711 million loss in 2009 to a valuable asset.

Abel had highlighted NetJets and Johnson during his first annual letter to shareholders back in February.

He wrote Johnson had “transformed NetJets from a challenged business model into a successful enterprise that delivers value for Berkshire.”

During today’s meeting, Abel directly linked the turnaround to Johnson’s 2015 appointment as CEO.

Johnson joined in 2003 and had risen to president before briefly leaving.

Abel told attendees, “We were fortunate enough to convince Adam to come back,” adding, “But he came back to a challenging situation.”

Abel said of NetJets in 2015, “The asset was underperforming. We had billions of dollars in debt back to the parent company, which was debt that had been incurred. And some real challenges.”

Abel then asked Johnson to discuss “how do we get a business back on track?”

Johnson recalled attending the 2010 Berkshire Hathaway annual meeting.

“I sat up in the arena, in May of 2010, and it was a hard thing to hear, but it was the truth, and Warren talked about NetJets and stated that it was his toughest mistake that year.”

Johnson noted, “But for the backing of Berkshire, we would have been bankrupt.”

Turnaround Strategy

He told attendees the first step was to ensure management was on the same page as to what the business was all about.

From there, it was ensuring the mission was understood at a “deeper and wider level.”

Johnson said the two pillars are “safety and service, safety and service,” and the company still uses a video from Buffett speaking to that after he bought the company in 1998.

Johnson notes, “NetJets is complicated. We’re ad hoc, we’re on (our customer’s) schedule. We fly to thousands of airports. Commercial airlines will fly to 50-100 airports. We fly to 150 countries.”

He also recalled his first board meeting after moving to the corner office.

Johnson said, “After we started building that back, it was also a reinforcement from Greg. I remember my first board meeting prep: I was excited. We were starting to move, and I was talking about growth (saying), ‘We’re gonna get this right, we’re gonna grow.’ And Greg pulled me aside in a very kind way. He said, ‘Why don’t you pay $1 back to Warren and work on getting your debt down?’”

Johnson added, “That was a teaching lesson. I took that to heart. I heard it clearly, and I actually already knew that. And so we just started really putting our blinders on, and we said, safety and service, safety, and service.”

He continued, “And we’ve been really focused on making sure everybody stays in that alleyway. That, in large part, plus a lot of hard work, is why we were able to pare down our debt. (It’s why) we’re able to pay cash back to Berkshire Hathaway.”

Johnson thanked Buffett, Munger, and Abel for their support and also pointed to his team.

He said of NetJets, “I do think we have a wonderful company, as Warren talked about, with Charlie in 2023. And I just want to say to them, thank you, because it’s been a rough road to do that.”

READ: NetJets takes delivery of first Bombardier Global 8000

For Sale?

Abel was asked during the question-and-answer session with shareholders about the possibility of selling businesses or breaking up the company.

Abel reinforced that Berkshire very rarely sells off business units.

However, he also offered what could be seen as a veiled warning about future labor unrest.

Abel told shareholders, “There are certain circumstances in which we may not be the best owners of a business. We’ve touched on if there are labor issues that we can not resolve.”

He added, “I would take it to the point… there’s reputational risk that we are not willing to ever have our owners or shareholders or Berkshire experience…if there is that type of situation, that company does not belong in the Berkshire family, and it may be a fine business that can be owned by somebody else.”

NetJets has had multiple battles with NJASAP, the union representing its pilots.

During a year of contentious negotiations, NJASAP ran a series of advertisements questioning NetJets’ safety while attacking Buffett.

The company also alleged that union actions were impacting the service its customers expect.

NetJets sued NJASAP for defamation.

Pilots approved a 52.5% increase in compensation over five years in 2024.

Breaking Up Berkshire Hathaway?

Abel also addressed whether or not Berkshire Hathaway could be split up.

He said, “Absolutely not.”

He told shareholders:

‘We are a conglomerate. But we are an efficient conglomerate. We don’t have layers of management. We don’t have a bunch of committees telling our businesses how to run, how they’re going to manage their customer relationships. We create frameworks, so there is value shared across the businesses, so they’re aware of what our other businesses are doing and technologies.’

Abel added, “We don’t create layers.”

He called Berkshire Hathaway’s current structure “very effective.”

Business Outlook

Abel, Johnson, and BNSF CEO Katie Farmer address several questions about the business outlook.

Abel addressed the rush to artificial intelligence solutions.

He said, “We’re not going to do AI for the sake of AI.”

However, Farmer pointed to technology as a way to drive efficiency and deliver better results for customers.

Discussing competition between trains and trucks, she noted that regulators are now exploring autonomous trucking.

She noted that while freight train crews, once five people, are now down to two, regulators need to ensure regulations enable businesses to explore ways to improve efficiency.

“We have to be able to do is to be able to compete with that and to be able to innovate,” Farmer said.

Discussing tariffs, Johnson noted the 32 companies in the consumer products and retail group have been in business an average of over 80 years, with five dating back to the 1800s.

He said the company’s response to tariffs was to stick to the Berkshire Hathaway playbook of focusing on customers and the long term.

“You’re always gonna have a curveball,” he said.

Both Farmer and Johnson said some companies were challenged to match Q1 2025 results that were boosted by pre-tariff actions last year.

Johnson affirmed that, to date, NetJets has not seen a demand impact from higher fuel costs.

However, he warned that if they keep rising, that could change.