Editor's note: This story has been updated to reflect that the announcement was made on Saturday at the Berkshire Hathaway annual meeting.

Warren Buffett shocked attendees at the Berkshire Hathaway Inc. (NYSE:BRK) annual meeting on Saturday by announcing that he will step down as CEO by the end of the year, with Greg Abel set to succeed him.

What Happened: The Associated Press reports that Buffett stated, “I think the time has arrived where Greg should become the chief executive of the company at year end.” Buffett will turn 95 on August 30.

Buffett’s retirement marks the end of a 60-year tenure during which he transformed Berkshire Hathaway from a struggling textile firm into a major conglomerate with a market capitalization of $1.16 trillion.

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Buffett plans to retain his Berkshire stock. He said, “I would add this, 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.” He also mentioned his intention to “hang around” to provide guidance during the transition, but operational and capital allocation decisions will be under Abel’s control.

The announcement came as a surprise to most of Berkshire’s board members, with only Buffett’s children, Howie and Susie, being aware of the plan. Abel has been considered as Buffett’s potential successor since at least 2021.

Why It Matters: Buffett’s retirement signifies the end of an era at Berkshire Hathaway. His investment strategies and leadership have been instrumental in the company’s growth.

Abel’s appointment as CEO is a significant move, marking a new chapter in the company’s history.

His leadership will be closely watched by investors and market analysts alike, as he takes on the challenge of steering the conglomerate in the post-Buffett era.

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