Buffett’s $27B Tax Bill, Nvidia Tanks After Earnings, & Trump’s Visa Math Fails

TL;DR

1. Berkshire Hathaway pays the largest corporate tax bill in history

2. BP slashes spending on renewables, doubles down on fossil fuels

3. Nvidia smashes earnings, but stock tanks 8.5%

4. Trump’s golden visa math doesn’t add up

Berkshire Hathaway

Berkshire Hathaway paid a record $27 billion in taxes in 2024 — the largest corporate tax bill in U.S. history, making up 5% of all corporate income taxes collected. Why the record bill? Berkshire’s massive stock sales (Apple and Bank of America) triggered big capital gains. 

To illustrate the scale, Warren Buffett quipped that even if Berkshire had cut a $1 million check to the Treasury every 20 minutes last year, it would still owe a hefty sum.

In his annual letter to shareholders, Buffett wrote:

Buffett’s love letter to taxes was a jab at corporations that pay lower effective rates than most American families. 

• Cruise lines, for example, have averaged sub-2% tax rates for years.

• GM and T-Mobile paid 5% and 0.4%, respectively, in 2023.

• Tesla reported $2.3 billion in U.S. income in 2024 but paid zero in federal income tax.

This is a bit rich coming from Buffett, as Berkshire’s own five-year average tax rate of 15% is lower than every Magnificent Seven firm except Tesla and Nvidia.

Buffett’s tax tribute arrives as Trump floats slashing corporate tax rates to 15%, despite U.S. corporate tax revenue already being just 1.6% of GDP — far below Canada (3.5%) and the U.K. (2%).

I don’t love Warren Buffett’s holier-than-thou attitude on taxes. He’s acting like the Jesus of the IRS. But there’s value in his perspective.

Buffett sees taxes as a point of pride, not resentment — a shift from the usual “screw this” mentality. If more people viewed paying taxes as doing a service to your country, rather than just losing money, maybe it wouldn’t feel so painful.

Of course, that requires actually believing in your country — something that’s becoming rarer by the day.

BP Goes Back to Black (Gold)

After its fourth-quarter profit hit a four-year low, BP announced it will slash its annual investments in renewable energy by $5 billion to $1.5 billion and focus instead on high-return, fossil fuel projects. BP shares closed down about 1.5%.  

This marks a sharp reversal from BP’s pledge five years ago to allocate ~30% of its capital expenditures to low-carbon energy by 2025. 

• But the company was never truly committed to going “beyond petroleum.” 

• In 2022, renewables accounted for just 6% of total capex.

Markets never bought the ESG play: BP stock has underperformed, climbing just 43% in five years, while competitors like ExxonMobil (+172%) and Cheniere Energy (+348%) soared.

There are two major arbitrages in today’s economy. First: talent. Build a culture that attracts top-tier 25- to 30-year-olds. They’ll work really hard. They’re creative. They think differently. They’re not yet distracted by dogs and kids, and you can pay them 60% of what a 40-year-old might demand. Look at all the companies that have added trillions in shareholder value. What do they have in common? They attract the best and brightest young people.

But by far, the greatest economic arbitrage has been taking dinosaur sh*t out of the ground and refining it into petroleum. There’s nothing like extracting crude for pennies on the dollar and refining it into an energy source that powers everything. BP is, and always has been, a petroleum company. Now, it’s just dropping the pretense.

Nvidia Crushes Earnings (Again), but Stock Slumps

Nvidia’s fourth-quarter sales surged 78% YoY, surpassing its entire 2022 annual revenue in just three months. Net income increased 80% YoY. It also forecast a stronger-than-expected first quarter, citing a “significant ramp” in sales of its next-gen AI chip, Blackwell.

Still, the stock dropped 8.5% on Thursday amid worries over export controls, tariffs, and fears of slowing growth. For Nvidia, a simple beat isn’t enough anymore — only total (world?) domination will impress Wall Street.

CEO Jensen Huang focused on three themes in the earnings call: inference (when AI uses what it's learned to produce responses), reasoning models, and cost efficiency. Nvidia’s Blackwell chip is 20x more efficient than its previous model at inference — the phase where AI models are used rather than trained. 

• Over the past two years, Nvidia has slashed inference costs by 200x.

• It’s also a model of efficiency internally. Since 2022, Nvidia has grown its revenue by 385%, while headcount has only increased 60%.

Huang praised DeepSeek for democratizing AI reasoning. Reasoning models can consume 100x more compute, making them a direct tail wind for Nvidia. This is Jevons paradox in action: The cheaper and more efficient a technology gets, the more the world ends up using it.

Nvidia isn’t just a market-moving stock — it’s the linchpin holding up the entire market (the Magnificent Seven account for almost a third of the entire S&P 500).

• Nvidia hype has transcended business news: it's become the Coachella of capitalism.

• At 4 p.m. on the day of its earnings, Google searches for “Nvidia” outpaced searches for The New York Times, ChatGPT, Instagram, and Wikipedia.

Trump says $5 million ‘gold card’ visas to replace current investor visa program

President Trump has proposed a new visa program that could lead to permanent residency for those willing to pay a $5 million fee. Commerce Secretary Howard Lutnick said the “gold card” visa would replace the EB-5 visa — a 1990 program Congress created to attract eligible investors who spend at least $1 million on a company that employs at least 10 people.

Predicting that the gold cards would “sell like crazy,” Trump suggested that his proposal could raise as much as $50 trillion in revenue — enough to retire the $35 trillion U.S. debt with room to spare.

• Reality check: The U.S. would need to sell 10 million gold cards to generate $50 trillion in revenue. 

• Even the most generous estimate of the total addressable market falls short of Trump’s revenue projections: There are only about 277,000 foreign individuals wealthy enough to afford a gold visa.

More than 100 countries offer visas designed to encourage investment, with some of the priciest visas issued by New Zealand ($2.8 million) and Singapore ($7.4 million). 

Critics warn that such programs are vehicles for money laundering, tax evasion, and corruption. Despite bringing in an estimated €25 billion in foreign direct investments over the past decade, EU officials called for an outright ban on golden passports and strict rules on golden visas, citing “serious security risks.” Several EU countries, including Ireland, Spain, Greece, and Portugal have either shut down or modified their programs. 

These kinds of visas aren’t new. My only concern is at this price point, if you can’t figure out a way to get into America or another Western country for a lot less than this, it means you’re on the run from the tax authorities or you’re pretty shady. To me, it says the noose is closing around your neck, and you need to get to America fast.   

Tesla stock goes below $150/share.

 Scott isn’t a lawyer, but rumor has it he plays one on TV. Check out Scott’s conversation with David Bernad, the Emmy-winning executive producer of HBO’s The White Lotus, to hear about Scott’s audition, the shifting business landscape in Hollywood, and what executive producers actually do. Listen here.

Mia’s Bonus Reads

1. This bean outperformed Nvidia last year.

2. How many episodes should you watch before giving up on a show? 

3. 50 years of travel tips (excellent and funny)

4. Reddit thread on the best AI prompts to “unf*ck your life”

Via Overheard on Wall Street