Warren Buffett Exits Nubank Holdings with $250 Million Profit

In 2021, Berkshire Hathaway invested a total of $750 million in Nu Holdings, acquiring 107 million shares—$500 million during a funding round and an additional $250 million during Nubank's initial public offering (IPO) in December of the same year. Over the subsequent years, Nubank's stock price surged by over 100%, leading to an estimated $250 million in profits for Berkshire Hathaway.

Despite Buffett's personal reservations about cryptocurrencies—famously calling Bitcoin "rat poison squared"—Nubank's crypto-friendly initiatives, including offering Bitcoin and Ethereum trading and launching a loyalty token on the Polygon blockchain, did not deter his investment. This suggests a pragmatic approach, focusing on the company's overall growth potential rather than its involvement in the crypto space.

The decision to divest from Nubank aligns with a broader rebalancing of Berkshire Hathaway's investment portfolio. In the first quarter of 2025, the conglomerate also exited its position in Citigroup by selling 14.6 million shares and reduced its holdings in Bank of America by 48.6 million shares. These moves indicate a cautious stance toward the financial sector amid market volatility.

Conversely, Berkshire Hathaway has increased its investments in consumer-focused companies. Notably, it has significantly increased its holdings in Domino's Pizza and Pool Corporation. These investments reflect a strategic pivot toward sectors with stable consumer demand.

Buffett's exit from Nubank, despite its strong performance and growth in the fintech sector, underscores his cautious approach to investments involving cryptocurrencies. While Nubank has expanded its crypto services, including a platform called Nubank Cripto launched in 2022, Buffett's divestment suggests a preference for traditional business models with predictable returns.

This move may also signal to other investors the importance of evaluating fintech companies beyond their crypto offerings, focusing instead on their overall financial health and growth prospects.

As Buffett prepares to step down as CEO of Berkshire Hathaway, passing the reins to Greg Abel, these strategic shifts in the company's investment portfolio may set the tone for its future direction. The focus appears to be on consolidating investments in sectors with consistent consumer demand and reducing exposure to more volatile industries.

Buffett's profitable exit from Nubank serves as a testament to his investment acumen, balancing risk and reward even in areas outside his traditional comfort zone. It also highlights the evolving landscape of the financial industry, where fintech and traditional banking increasingly intersect.