The company Warren Buffett built, Berkshire Hathaway (BRKA -0.04%) (BRKB +0.11%), was a phenomenal performer over the 60 years when he was in charge. From 1965 through 2025, the S&P 500 index gained 46,000% (10.5% annually, on average), while Berkshire Hathaway grew in value by 6,100,000% (nearly 20% annually).
Buffett retired as CEO at the end of 2025, and Greg Abel is now at the helm. Clearly, shareholders have made tidy profits over many years. Most interestingly, though, they have done so without dividend income. Here's how.
Image source: The Motley Fool.
Dividends in perspective
First, when companies generate profits, there are many things they can do with those dollars -- such as paying down debt, hiring more people, building more factories, buying more ads or other companies, repurchasing their own shares -- and/or paying a dividend.
Companies will generally only commit to paying a dividend once they have grown big enough and stable enough to have fairly dependable income. They don't want to have to shrink or curtail their dividend payments, as that's a very bad look.
In Berkshire Hathaway's case, it's already huge, and it has ample dependable income. So why no dividend? It's because the company has been choosing to spend its money buying other companies, buying stock in other companies, and occasionally buying back shares of its own stock.
NYSE: BRKB
Key Data Points
And that's how it has rewarded its shareholders. When it buys stocks, they will ideally grow in value (possibly also paying dividends), and that will make Berkshire -- and its own shares -- more valuable. When more companies are acquired, they will typically be generating cash, which Berkshire can then reinvest to maintain and boost its value. Dividends are great, but they're not required for wealth building.
Warren Buffett and dividends
Buffett does love dividends, though. Since Berkshire Hathaway owns a lot of stocks, and in total, it collects billions of dollars in dividends from them annually. For example, it owns 22% of American Express, along with 7% of Chevron and 9% of Coca-Cola. Recently, Chevron had a dividend yield of 3.8%, American Express paid 1.19%, while Coca-Cola yielded 2.6%.
Buffett has also suggested in the past that he would consider paying a dividend when he didn't think there would be better use for the company's money.
Greg Abel and dividends
What should matter more to investors these days is what Greg Abel thinks about paying dividends. He must be considering them, given that Berkshire's cash hoard recently approached $400 billion. He could continue to buy stocks and other companies while paying a dividend, should he choose to.
