Berkshire Hathaway is losing one of its top stars just as Warren Buffett makes his exit.
Todd Combs, the stock picker who stepped in to lead the turnaround of Berkshire’s Geico auto-insurance arm, will decamp for JPMorgan Chase.
His departure, announced Monday, was by far the most unexpected move in a series of executive changes Berkshire unveiled mere weeks before Buffett hands off his CEO role to Greg Abel.
“I was really surprised,” said Paul Lountzis, president of Lountzis Asset Management, which owns Berkshire shares. “When you look at the future, it is more murky now that Todd’s gone.”
Berkshire also announced that longtime finance chief Marc Hamburg was retiring, and that the company had tapped Snap’s Michael O’Sullivan as general counsel.
Berkshire is on the cusp of a new era: Abel, the company’s vice chairman and the lead executive of its many non-insurance businesses, will take over as chief executive officer in January. And while he hasn’t publicly addressed his plans for Berkshire, Combs’s exit suggests Abel is already beginning to put his stamp on the company, including its massive investment portfolio.
“The announcement is just one more indication of the orderly transition that Warren and Greg have put forward,” said Ron Olson, who served on Berkshire’s board for more than two decades before stepping down earlier this year.
Buffett hired Combs, a successful, if little-known, hedge-fund manager, in 2010 to help manage Berkshire’s enormous investment portfolio. He then landed atop Geico, where the 54-year-old executive is credited for orchestrating its successful revamp. Buffett last year called his improvements “spectacular.”
Combs’s performance at Geico made him a top candidate to succeed insurance chief Ajit Jain, who is 74 years old. Combs also had an enviable stock picking record, having earned a net cumulative 34% while running his own fund from 2005 to 2010, a financial crisis-era period when the S&P 500 produced 1.15%.
“Todd made many great hires at Geico and broadened its horizons,” Buffett said in a statement. “JPMorgan, as usually is the case, has made a good decision.”
Berkshire’s class A shares were down 1.4% Monday. The stock has dropped 7.9% since May, when Buffett announced plans to step down as CEO.
For shareholders of a company whose CEO was a fixture in corporate America for more than a half-century, any significant departure can be unsettling, said Meyer Shields, an analyst at Keefe, Bruyette & Woods.
Shields, along with other KBW analysts, downgraded Berkshire shares to an “underperform” rating earlier this year, citing Buffett’s departure as one reason for the stock’s recent declines.
“There’s so much emotional investment in the persistence of Berkshire as a culture that when you have decent-sized changes, that’s going to cause more worry than jubilation over the company’s dynamism,” said Shields. “That’s not why people own Berkshire Hathaway.”
Combs will lead a $10 billion strategic-investment group within JPMorgan’s new security-and-resiliency initiative, and act as a special adviser to Chairman and CEO Jamie Dimon. He has served as a director at the bank since 2016, but will step down from that role now that he is joining in an executive role.
Hamburg will step down on June 1, Berkshire said. He will be succeeded by Charles Chang, finance chief of Berkshire Hathaway Energy.
“Marc has been indispensable to Berkshire and to me,” Buffett said Monday.
O’Sullivan, a longtime legal colleague of former Berkshire vice chair Charlie Munger, will start as general counsel, a new position for Berkshire, in January. Before joining Snap, the social-media company, O’Sullivan spent more than two decades at Munger, Tolles & Olson. Munger, who co-founded that firm, died in 2023.
Buffett, 95, said last month he would be “going quiet” as he prepares to step down from the company he has led since the 1960s. In May, the billionaire investor revealed his plans to step down as Berkshire’s chief executive at the end of this year.
Berkshire said Nancy Pierce, who has worked for Geico for four decades and most recently served as chief operating officer, will succeed Combs at the helm of the insurer. Unlike Combs, who lived in Omaha and often traveled to the Washington, D.C.-area, she works out of Geico’s Washington-area headquarters.
Combs joined Berkshire from his own fund, Castle Point, in 2010 to help manage Berkshire’s vast investment portfolio. Less than a year later, Buffett added a second hedge-fund executive, Ted Weschler, to the mix.
The two investors kept a low profile, and Berkshire rarely disclosed which executive—Buffett, Combs or Weschler—were behind the decisions to buy or sell key positions within the portfolio.
But Combs’s 2020 appointment at Geico, a top U.S. auto insurer, signaled to Berkshire watchers that he was being groomed for bigger roles at the conglomerate. In time, he was seen by many as a potential heir to Buffett himself.
When that role went to Abel, some expected Combs would receive a broader remit at the investment portfolio, leaving the new CEO to focus on major acquisitions and capital allocation.
His departure leaves questions on how Abel intends to manage those investments, which include big stakes in Apple, American Express, Bank of America and Coca-Cola. It also removes one of the handful of executives Berkshire shareholders thought might one day replace Jain as head of the company’s insurance empire.
“Todd Combs is one of the greatest investors and leaders I’ve known,” Dimon said in a statement.
JPMorgan Chase also named tech billionaires Jeff Bezos and Michael Dell, plus an all-star cast of retired generals and politicians, to an advisory council for advice on its plans to finance $1.5 trillion in capital for companies deemed critical to national security, including the $10 billion of its own funds Combs will oversee.
Comments