You already know who Warren Buffett is: He’s the guy who turned a tiny textile company into a $1.2 trillion conglomerate and the 8th largest publicly traded company in the world using the power of value investing.

If you’ve somehow been living under a rock for the last 60 years that Buffett has been at the helm of Berkshire Hathaway, here’s the short version:

• Buffett's strategy of picking high-quality, underpriced stocks propelled Berkshire’s shares up 5,502,284% over the six decades ending December 2024. The S&P 500 has climbed 39,054% over the same period.
• Put another way: Berkshire Hathaway shares have appreciated 19.9% annually in the last 60 years, while the S&P 500 gained about 10.4% per year.
• A single dollar invested in Berkshire at the start of Buffett’s career would be worth about $365,000 today.

Oh, and if you were anywhere near Berkshire’s investor conference in Omaha, Nebraska over the weekend, you probably heard the roaring, spontaneous applause for Buffett after the 94 year-old announced he was stepping down as CEO of Berkshire Hathaway by the end of the year.

But enough about the Oracle of Omaha. The more pressing question: Who the heck is Greg Abel, his successor?

Will Greg be Abel to live up to Buffett’s legacy?

Abel, 62, has been a part of Berkshire Hathaway since the acquisition of his firm MidAmerican Energy in 2000, but Buffett plucked him from the pack and elevated him to vice chairman in 2018, where he’s been helping Buffett run Berkshire and preparing for his future role.

Abel has big shoes to fill—after all, Buffett is more than just your average billionaire CEO. Buffett has built a legacy that will be hard to emulate, and earned a unique level of trust from shareholders over the decades.

Berkshire’s shares dropped 5.02% today—not exactly a vote of confidence from investors.

“Certainly some of the magic of the company is lost,” said Bloomberg Intelligence equity analyst Matthew Palazola in a conversation with Brew Markets.

Among Abel's biggest challenges are maintaining Berkshire’s ability to strike deals and, of course, managing Berkshire’s massive portfolio of businesses featuring companies like Geico and See’s Candies.

Don’t forget Berkshire’s $348 billion pile of cash, either. “Any other company holding that much excess capital would certainly face a lot of shareholder angst,” said Palazola. “In a world where Greg's a CEO, it is completely fair for investors to really question why they need to hold that much excess cash,” he added.

At least one person has a vote of confidence in Abel. “I have no intention—zero—of selling one share of Berkshire Hathaway. I will give it away eventually,” Buffett said. “The decision to keep every share is an economic decision because I think the prospects of Berkshire will be better under Greg's management than mine.”—LB

🟢 What’s up

• Skechers exploded 24.35% after the footwear retailer inked a deal with 3G Capital to go private.
• Electronic Arts climbed 2.41% on the news that it has teamed up with Major League Soccer to offer four matches via its mobile gaming platform this year.
• United Airlines rose 1.07% despite its announcement that it’s cutting some flights out of Newark, New Jersey, where apparently flying is terrible.
• Howard Hughes Holdings gained 2.81% thanks to a $900 million investment in the real estate company from Bill Ackman’s Pershing Square.

What’s down

• Sunoco sank 5.64% on the oil & gas company’s plans to acquire Canadian gas station chain Parkland Corporation for $9.1 billion.
• Shell fell 2.28% on reports that the company is considering ways to acquire rival BP.
• ON Semiconductor lost 8.35% despite outpacing analysts' estimates on both the top and bottom lines, as shareholders focused on warnings of weaker demand.
• Tyson Foods fell 7.75% after the meat giant missed sales estimates and warned revenue will remain flat in the coming year.
• Loews may have beaten analysts' estimates on revenue, but the luxury hospitality stock still fell 1.77% after missing on profits.
• Wolfspeed, which is a company name we will never get tired of writing, gave up another 8.52% following a wild short squeeze last week.

That’s a wrap on cheap international film productions.

On Sunday evening, President Trump proposed a 100% tariff on movies shot outside the United States. “WE WANT MOVIES MADE IN AMERICA, AGAIN!” the president declared via Truth Social.

Making a blockbuster is a big business unto itself, and governments around the globe offer enormous incentives like tax breaks to pull productions their way. The result has been a 40% decline in the number of movies actually made in Hollywood over the last decade, the Guardian reported. The president would seemingly like to reverse that trend, though early indications are that tariffs on foreign productions may do more harm than good to the movie industry.

Media stocks reacted to the news exactly the way you’d expect: Netflix fell 1.94%, Warner Bros. Discovery sold off 1.99%, and Paramount Global sank 1.53%, while theater operators like Imax fell 2.09%, Cinemark dropped 1.72%, and AMC lost 1.49%. But Wall Street analysts didn’t move to cut their forecasts for these stocks, recommending instead that investors pan today’s tariff preview and wait for the full feature-length levies before selling.

The core of Big Tech earnings season unfolded last week, and if we learned anything—besides the fact that Mark Zuckerberg hasn’t yet learned how to sound like a human—it’s that the AI trade is alive and well.

Magnificent Seven behemoths are still investing heavily in building out AI infrastructure like data centers with the hope of winning the AI arms race. While investors have voiced skepticism about this monster spending spree, last week proved that big tech has kept calm and spent on.

Just look at Meta, which raised its 2025 capital expenditures forecast from its previous plan to spend $65 billion to a staggering $72 billion. The company had the revenue growth to back up its expensive habits—Meta said it projects Q2 revenue of roughly $44 billion, above analyst expectations.

Microsoft is also heavily splashing out on AI, although its spending slowed slightly. In the first quarter of the year, Microsoft spent $21.4 billion on capex, about $1 billion less than it spent in the category in Q1 of last year. But excluding financial leases, the company’s capex spending was 53% higher than the year prior.

Those aren’t the only Mag 7 names shelling out for robots: Earlier this year, Amazon said it was planning to allocate $100 billion in 2025 on capital expenditures. But Apple, which is far less focused on AI than its peers, expects to spend roughly $10.77 billion on capex in fiscal 2025.

Paying for the AI revolution

The Mag 7 aren’t betting big on the AI transformation just because they like to burn money—AI is transforming how they actually operate. For example, CEO Satya Nadella said last week roughly 30% of Microsoft software code is written by—you guessed it—AI bots instead of humans.

Wall Street, for one, has given these companies’ massive spending plans its vote of approval: Analysts overall have consensus buy or overweight ratings on Amazon, Apple, Meta, and Microsoft. But of these four stocks, only shares of Microsoft and Meta Platforms are positive so far in 2025. The fact that these two companies are also ramping up their AI spending sprees is likely no coincidence, as investors continue to buy into the AI trade.—LB

• OpenAI has reversed course and will leave its nonprofit arm in control.
• eToro could be going public as soon as next week.
• Tough times in Beantown: Boston homeowners are on the hook for a $1 billion tax bill.
• Google is getting into the film and television game.
• President Trump stands to make millions from two big crypto events this month.
• Speaking of crypto, a landmark bill has hit a roadblock in the Senate.
• Did you know the Fed has secret ratings for how safe big banks really are?

Tuesday brings us a report on the trade deficit, or the difference between imports and exports. This usually quiet report should make for an interesting read, revealing the economic effects of companies spending big bucks trying to get ahead of tariffs.

Earnings season continues in earnest tomorrow, with names like Arista Networks, Constellation Energy, Marriott, Fidelity, Electronic Arts, Datadog, IQVIA, Wynn Resorts, Global Payments, Rivian, Astera Labs, WK Kellogg Co., Redfin, and Ferrari dropping their latest quarterly numbers.

But all eyes are on two stocks that can keep the AI trade alive a little while longer, or end it entirely.

After the close

• AMD is looking more and more like an also-ran these days, down over 30% in the last 12 months compared to Nvidia’s 30% gain. Then again, that means investors might find something rare in the AI trade: value. AMD’s business will be hurt by tariffs and any potential capex cuts from big tech companies, but its data center business is still strong, demand for its products remains robust, and its shares look cheap. Buyer beware: This could be a diamond in the rough, or a total headfake. Consensus: $0.93 EPS, $7.1 billion in revenue.
• Super Micro Computer makes AMD look like a success, what with its 55% decline in the last year. Bulls would argue that the company’s facing short-term problems like a slow GPU rollout, and that business will recover in the long term thanks to strong demand for servers and cloud storage. Bears would point to preliminary results last week that indicated customers are cutting costs and hurting the bottom line. This is either a value play or a value trap, with little middle ground to be found. Consensus: $0.54 EPS, $5.41 billion in revenue.

In the last month we’ve seen the worst April market drop since 1932 and the longest winning streak in decades. So, what happens next?

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