Berkshire Profit Before Tax Categorized By Segment

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This page covers Berkshire Hathaway’s pre-tax profit (earnings before income taxes) categorized by segment, consisting of all operating businesses such as insurance, BNSF, BHE, manufacturing, services & retailing, McLane, Pilot, and consolidated.

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For other key statistics of Berkshire Hathaway, you may find more information on this page: Berkshire key statistics.

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Definitions

To help readers understand the content better, the following terms and glossaries have been provided.

Pre-Tax Profit: Pre-Tax Profit, formally reported on the income statement as Income Before Income Taxes, is a financial metric that shows a company’s total profits after all operating and non-operating expenses have been deducted, but before corporate income taxes are subtracted.

Positioned near the very bottom of the Income Statement, it represents the final financial milestone before arriving at the absolute bottom line (Net Income). It tells investors exactly how much money the business generated from its operations and investments before the government takes its statutory cut.

Insurance: Berkshire Hathaway’s insurance business is a major component of its diversified portfolio and includes several key divisions:

1. GEICO: A well-known auto insurance company that provides coverage for millions of drivers.
2. Reinsurance: This division takes on large, complex risks that other companies may be unwilling or unable to write. Berkshire Hathaway has a strong reputation for handling long-tail reinsurance agreements, which involve taking on significant liabilities over an extended period.
3. General Insurance: This segment covers a wide range of insurance products, including property and casualty insurance.

The success of Berkshire Hathaway’s insurance business lies in its ability to accurately price policies and manage risks effectively. The company’s substantial capital reserves and conservative approach to underwriting allow it to take on risks that others avoid, contributing significantly to its overall profitability.

Railroad (“BNSF”): Berkshire Hathaway’s railroad business is primarily represented by Burlington Northern Santa Fe, LLC or BNSF Railway Company (BNSF), one of the largest freight railroad networks in North America.

BNSF provides a vital link for the transportation of goods and commodities across the United States, covering approximately 32,500 miles of track in 28 states and three Canadian provinces. Here are some key aspects of BNSF:

• Services: BNSF transports a wide variety of goods, including agricultural products, consumer goods, coal, industrial products, and petroleum.
• Network: The extensive network connects major markets and ports, facilitating the efficient movement of goods across long distances.
• Efficiency: Known for its operational efficiency and reliability, BNSF plays a crucial role in the supply chain for many industries.
• Ownership: Berkshire Hathaway acquired full ownership of BNSF in 2010, making it a wholly-owned subsidiary.

BNSF’s operations are a significant component of Berkshire Hathaway’s overall revenue and profitability, contributing to the conglomerate’s diversified business portfolio.

Berkshire Hathaway Energy (“BHE”): Berkshire Hathaway Energy (BHE) is a diversified energy company and wholly-owned subsidiary of Berkshire Hathaway Inc. BHE generates, transmits, stores, distributes, and supplies energy across the United States, Great Britain, and Alberta, Canada. Here are some key aspects of BHE:

• Business Portfolio: BHE owns and operates several utilities, including MidAmerican Energy Company, PacifiCorp, NV Energy, and Northern Powergrid.
• Renewable Energy: BHE has made significant investments in renewable energy projects, including wind, solar, and geothermal power.
• Natural Gas: The company owns several interstate natural gas pipeline companies and has a substantial natural gas transportation capacity.
• Sustainability: BHE is committed to environmental stewardship and aims to achieve net-zero greenhouse gas emissions.
• Customer Base: BHE serves over 13 million customers and end-users, providing reliable and low-cost energy solutions.

BHE’s vision is to be the best energy company in serving its customers while delivering sustainable energy solutions.

Pilot Travel Centers (“PTC”): Pilot Travel Centers, now fully owned by Berkshire Hathaway, is the largest operator of travel centers in North America. Founded in 1958 by James A. Haslam II as a single gas station, it has grown into a major network with over 750 locations across the U.S. and Canada.

Under the Pilot Flying J and Mr. Fuel brands, it provides services such as gas pumps, fast-food restaurants, parking, laundry, and showers to truck drivers and other motorists. Pilot Travel Centers sells about 14 billion gallons of fuel and $3 billion worth of food and merchandise annually.

According to the 2023 annual report, Berkshire acquired control of PTC on January 31, 2023 and PTC is considered a reportable segment beginning February 1, 2023. As a result, the revenue data of the PTC segment for fiscal year 2023 are for the eleven months ending December 31, 2023. Previously, the earnings from PTC were determined under the equity method and included in earnings from non-controlled businesses.

Manufacturing: Berkshire Hathaway’s manufacturing business encompasses a diverse range of industries and products, making it a significant part of the company’s overall operations. Here are some key components of this segment:

Precision Castparts Corp. (PCC)

• Products: Manufactures complex metal components and products primarily for aerospace, power, and industrial markets.
• Specialization: Known for its precision manufacturing capabilities and high-quality standards.

Marmon Holdings, Inc.

• Products: Operates a group of diverse businesses including engineered products, transportation equipment, and construction products.
• Specialization: Focuses on providing solutions across various industries through its wide range of subsidiary companies.

IMC International Metalworking Companies

• Products: Produces metal cutting tools and tooling systems for a variety of industrial applications.
• Specialization: Renowned for innovation and advanced manufacturing technologies.

Forest River, Inc.

• Products: Manufactures recreational vehicles (RVs), cargo trailers, buses, and commercial vehicles.
• Specialization: Offers a broad range of products designed for leisure, commercial, and personal use.

Johns Manville

• Products: Produces insulation, roofing materials, and engineered products for commercial and residential buildings.
• Specialization: Committed to sustainability and energy efficiency in its product offerings.

The Lubrizol Corporation

• Products: Provides specialty chemicals, including additives for transportation and industrial lubricants.
• Specialization: Focuses on enhancing the performance and efficiency of various fluids and materials.

These businesses contribute to Berkshire Hathaway’s robust manufacturing segment by delivering a wide array of products and solutions across multiple industries.

McLane Company (“McLane”): McLane Company is a wholly-owned subsidiary of Berkshire Hathaway Inc. Founded in 1894, McLane is one of the largest supply chain services leaders in the United States.

The company provides grocery and foodservice supply chain solutions to convenience stores, mass merchants, drug stores, and chain restaurants. McLane operates over 80 distribution centers across the U.S. and one in Brazil, delivering more than 50,000 different consumer products to nearly 90,000 locations.

Service And Retailing: Berkshire Hathaway’s service and retailing businesses encompass a wide array of companies, each catering to different markets and consumer needs. Here’s a snapshot of some of the key players in this segment:

Service Businesses

1. NetJets: A leader in fractional jet ownership, providing private aviation services for individuals and businesses.
2. Berkshire Hathaway Automotive: One of the largest dealership groups in the United States, offering a broad range of new and used vehicles along with related services.
3. FlightSafety International: Provides professional aviation training for pilots, maintenance technicians, and other aviation professionals.

Retailing Businesses

1. Borsheims Fine Jewelry: A high-end jewelry store known for its extensive selection of fine jewelry, watches, and gift items.
2. Nebraska Furniture Mart: One of the largest home furnishing stores in North America, offering furniture, appliances, electronics, and flooring.
3. See’s Candies: A manufacturer and retailer of premium chocolates and other confectionery products.
4. Brooks Sports: Specializes in high-performance running shoes, apparel, and accessories.
5. Dairy Queen: Operates and franchises a chain of quick-service restaurants known for their ice cream and fast food.

These businesses contribute significantly to Berkshire Hathaway’s diverse portfolio, providing a steady stream of revenue across various industries. Each company within this segment operates independently but benefits from the overall stability and resources of Berkshire Hathaway.

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Insight & Summary of Berkshire’s Profit Before Tax Categorized By Segment

The following analysis consolidates the trends observed across Berkshire Hathaway’s pre-tax profit and profit margin by segment for the 2016–2025 period.

• Insurance: From Margin Laggard to Margin Leader Insurance has undergone the most dramatic margin transformation of any segment. Pre-tax margin ranged 9.0–13.1% from FY2016–FY2022 (with a FY2017 trough of 2.5% reflecting catastrophe losses) before surging to 19.5% (FY2023), 26.8% (FY2024), and 23.7% (FY2025). The FY2023–FY2025 average margin of 23.3% — roughly double the FY2016–FY2022 average — reflects GEICO’s underwriting remediation and a hardening reinsurance pricing cycle, consistent with the underwriting profit analysis discussed previously. With FY2023–FY2025 average revenue of $101,434M and pre-tax profit of $23,789M, Insurance has become the single largest profit-mix contributor at 47.5% — nearly double its FY2016–FY2022 average mix of approximately 18%. This is the most consequential structural shift in Berkshire’s segment profitability profile over the decade.

• BNSF: The Highest-Margin Operating Business, Now Under Pressure BNSF consistently posts the highest pre-tax margin of any segment — 27.7–33.8% throughout the dataset, reflecting the railroad’s high operating leverage and capital-intensive but fixed-cost-dominated economics. The FY2023–FY2025 average margin of 28.8% remains the portfolio’s structural high-water mark, though it represents a modest decline from the FY2021 peak of 33.8%. BNSF’s mix contribution has compressed from 22–34% (FY2016–FY2021) to a FY2023–FY2025 average of 13.8%, driven primarily by Insurance’s mix expansion rather than any BNSF deterioration — BNSF’s FY2023–FY2025 average pre-tax profit of $6,812M is broadly consistent with its FY2019–FY2022 range. BNSF demonstrates that even mature, low-growth businesses can sustain best-in-class margins through pricing power and operational efficiency.

• BHE: The Wildfire Margin Collapse and Recovery BHE’s margin profile shows the starkest single-year disruption in the dataset: from 11.9% (FY2022) to 3.6% (FY2023) — a collapse directly attributable to the wildfire litigation provisions discussed in the capital expenditure analysis. The FY2024 recovery to 8.7% and FY2025 continuation at 8.9% confirm partial normalisation, but the FY2023–FY2025 average margin of 7.1% remains well below the FY2016–FY2022 average of approximately 12.5%. BHE’s pre-tax profit growth of +143.8% (FY2024) — off the depressed FY2023 base — illustrates how dramatically the wildfire provision distorted the FY2023 figure; the FY2023–FY2025 average growth of 25.3% should be read with this base-effect distortion in mind. BHE’s FY2023–FY2025 average pre-tax profit of $1,858M is the lowest of any major segment relative to its revenue base ($26,218M average) — a margin profile that, absent the litigation overhang, would normally sit closer to 11–13%.

• Manufacturing: The Steadiest Margin Performer Manufacturing has delivered the most consistent margin profile in the entire dataset — a tight 13.6–16.0% band across all ten years with no major disruptions. The FY2023–FY2025 average margin of 15.5% is essentially identical to the FY2016–FY2022 average. With average revenue of $77,041M and pre-tax profit of $11,970M, Manufacturing is the second-largest absolute profit contributor after Insurance, and its mix share of 24.2% (FY2023–FY2025) — down modestly from approximately 30% in FY2016–FY2022 due to Insurance’s expansion — reflects dilution rather than underperformance. Manufacturing’s growth average of 4.0% is modest but positive in every year of the FY2023–FY2025 window, confirming this segment’s role as Berkshire’s most dependable industrial earnings base.

• Services & Retailing, McLane, and Pilot: The Low-Margin, High-Revenue Tail These three segments share a structural characteristic: substantial revenue contribution paired with thin margins. Services & Retailing’s FY2023–FY2025 average margin of 10.2% is respectable for a diversified retail/service portfolio, with average pre-tax profit of $4,153M on $40,839M revenue. McLane — Berkshire’s grocery and foodservice distribution business — operates at a structural 0.5–1.3% margin throughout the dataset (FY2023–FY2025 average: 1.1%), characteristic of high-volume, low-margin distribution economics; McLane’s average pre-tax profit of $588M on $51,837M revenue (more revenue than BNSF or BHE) illustrates that revenue scale is a poor proxy for profit contribution in this portfolio.

  Pilot — consolidated beginning FY2023 — shows a margin decline from 1.9% (FY2023) to 1.3% (FY2024) to 0.5% (FY2025), with the FY2023–FY2025 average margin of 1.2% in line with McLane’s distribution-style economics. Pilot’s FY2024–FY2025 growth average of -52.8% (the only two periods with comparable data) reflects normalising fuel margins post-acquisition and possibly integration-related cost pressures. At $46,943M average revenue but only $591M average pre-tax profit, Pilot — like McLane — contributes meaningfully to top-line scale without proportionate bottom-line impact.

• Total Operating Businesses vs. Consolidated: The Investment Gains Wedge The “Total from Operating Businesses” line — pre-tax profit before investment gains, equity method earnings, corporate items, and eliminations — grew from $25,408M (FY2016) to a FY2023–FY2025 average of $49,762M, with average margin of 13.5% on average revenue of $367,972M. This represents the cleanest measure of Berkshire’s underlying operating profitability and shows steady, unspectacular growth consistent with a mature industrial conglomerate.

  The Consolidated pre-tax profit figure, by contrast, is dominated by investment gains volatility: from $33,667M (FY2016) to -$30,500M (FY2022) to $120,166M (FY2023). The FY2023–FY2025 average Consolidated pre-tax profit of $104,334M — more than double the operating businesses total of $49,762M — reflects the continued positive (though declining) contribution of investment gains during this window. The Consolidated growth average of -175.8% over FY2023–FY2025 is a meaningless aggregate of three large swings and underscores why the operating businesses total, not the consolidated figure, should anchor any segment-level profitability analysis.

• Structural Takeaway: Berkshire’s segment profitability profile for FY2023–FY2025 reveals a portfolio increasingly anchored by Insurance, which at 47.5% of operating pre-tax profit mix and a 23.3% margin has become both the largest and one of the highest-margin segments — a remarkable reversal from its historically modest single-digit-to-low-teens mix contribution. BNSF retains the title of highest-margin segment (28.8%) but has become proportionally less significant to the total mix. BHE’s margin compression to 7.1% — driven by wildfire litigation — represents the primary segment-level drag on operating profitability, with recovery trajectory (8.7% → 8.9%) suggesting gradual normalisation but not yet a return to the pre-2023 baseline of approximately 12%.

  The structural divide between high-margin segments (Insurance, BNSF, Manufacturing, all above 15%) and low-margin, high-revenue segments (McLane, Pilot, both below 1.5%) illustrates that Berkshire’s portfolio architecture deliberately combines capital-light, high-margin compounders with capital-intensive or distribution-style businesses that provide revenue diversification and cash flow stability without proportionate margin contribution. For investors, the operating businesses total ($49,762M average pre-tax profit at 13.5% margin) represents the most reliable baseline for assessing Berkshire’s underlying earnings power, while the BHE margin recovery trajectory and Insurance’s ability to sustain its newly-elevated 23%+ margin through a full underwriting cycle are the two most important segment-level variables for forward profitability assessment.

The table below combines all key Berkshire’s segment pre-tax profit margin metrics into a single view for the latest three fiscal years.

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Revenue Breakdown By Segment

You may find the definitions of Berkshire’s pre-tax profit here: Pre-Tax Profit (earnings before income taxes).

More information about Berkshire’s segments is available here: insurance, BNSF, BHE, PTC, manufacturing, service and retail, and McLane.

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Pre-Tax Profit Breakdown By Segment

You may find the definitions of Berkshire’s pre-tax profit here: Pre-Tax Profit (earnings before income taxes).

More information about Berkshire’s segments is available here: insurance, BNSF, BHE, PTC, manufacturing, service and retail, and McLane.

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Pre-Tax Profit Mix By Segment

You may find the definitions of Berkshire’s pre-tax profit here: Pre-Tax Profit (earnings before income taxes).

More information about Berkshire’s segments is available here: insurance, BNSF, BHE, PTC, manufacturing, service and retail, and McLane.

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Pre-Tax Profit Growth By Segment

You may find the definitions of Berkshire’s pre-tax profit here: Pre-Tax Profit (earnings before income taxes).

More information about Berkshire’s segments is available here: insurance, BNSF, BHE, PTC, manufacturing, service and retail, and McLane.

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Pre-Tax Profit Margin By Segment

You may find the definitions of Berkshire’s pre-tax profit here: Pre-Tax Profit (earnings before income taxes).

More information about Berkshire’s segments is available here: insurance, BNSF, BHE, PTC, manufacturing, service and retail, and McLane.

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Credits And References

1. All financial data presented in this article was obtained and referenced from Berkshire Hathaway’s annual reports published in the company’s investor relation page: Berkshire’s Reports.

2. Pexels Images.

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Disclosure

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