Berkshire Hathaway Inc. (BRK-B) Income Statement

The 10-quarter trend shows revenue oscillating between $89.7B and $101.8B, with the most recent quarter (2026Q2) posting a 10.0% YoY increase, the strongest in the series. However, the prior four quarters averaged near-zero growth, indicating that the surge may be a one-off rather than a sustained acceleration. This mixed trajectory suggests that while insurance premiums and industrial demand may be stabilizing, the lack of consistent top-line expansion points to a mature business facing cyclical headwinds.

The combined ratio ranged from 82.5% to 86.2%, with the latest quarter at 82.8%, reflecting strong loss ratio control (76.6%) and expense discipline. This suggests that Berkshire's insurance operations are generating an underwriting profit, which is a key competitive advantage. However, the loss ratio has ticked up slightly from 72.2% in 2024Q4 to 76.6% in 2026Q2, which may indicate rising claims costs or a softer pricing environment, though it remains within a manageable range.

The loss ratio has been remarkably stable, hovering between 75.4% and 78.2%, even as revenue growth has fluctuated. This stability may indicate that management is releasing reserves from prior years to offset current-year loss deterioration, a common practice in long-tail lines. Investors should monitor whether reserve releases are masking a deterioration in current accident-year loss ratios, which could signal future earnings pressure if the releases are not sustainable.

The investment income line is not separately disclosed in the provided data, but the volatility in net income—ranging from $4.6B in 2025Q1 to $30.8B in 2025Q3—strongly suggests that equity portfolio mark-to-market movements are the primary driver. This creates 'phantom' earnings that obscure the underlying operating performance, which is more stable as evidenced by operating income ranging from $12.7B to $17.5B. The reliance on investment income for profitability underscores the importance of equity market performance, which may not be sustainable in a prolonged downturn.

With a combined ratio consistently below 86%, the expense ratio (combined ratio minus loss ratio) has been in the 6-8% range, reflecting Berkshire's scale and cost discipline. This efficiency is a competitive moat, as smaller insurers struggle to achieve such low expense ratios. However, the lack of revenue growth suggests that this efficiency is not translating into top-line expansion, which may limit future margin improvements.

This quarter stands out as the highest net income in the series, with EPS of $14.28, more than double the prior quarter's $5.73. The surge appears to be driven by investment gains rather than operational improvements, as operating income was only $16.7B, similar to other quarters. This inflection point underscores the need for investors to separate operating earnings from investment-driven volatility when assessing the company's true profitability.