NetJets reported net profitability in fiscal 2025 under CEO Adam Johnson, ending a cycle that cost Berkshire Hathaway $711 million in pre-tax losses between 1998 and 2009 alone. The Columbus-based operator now grows faster than the broader private aviation market, reversing what Warren Buffett called his "worst deal ever" in a 2009 shareholder letter.

Johnson took the CEO role in January 2024 after running the European division. NetJets declined to publish exact margin figures but confirmed positive operating income for the first time in six years. The company holds 6,800 active owners across its fractional and jet-card programs, up 11 percent year-over-year, while industry-wide private flight activity grew 7 percent in the same window. Flight hours per aircraft increased 14 percent, indicating tighter utilization discipline—the metric Buffett cited as structurally broken when he considered exiting the business in 2009.

The turnaround follows three operational changes. First, NetJets retired its entire Embraer Phenom 300 fleet and standardized around Textron's Citation and Bombardier's Challenger lines, cutting maintenance complexity. Second, the company raised its 25-hour jet-card entry threshold to $200,000 from $150,000 in 2023, filtering low-margin episodic fliers. Third, NetJets now pre-positions aircraft using predictive routing algorithms developed with Palantir Technologies, reducing empty-leg costs by 18 percent since Q2 2024. Berkshire does not break out NetJets revenue in Hathaway's aviation segment, which generated $1.1 billion in Q1 2025 across NetJets, FlightSafety, and specialty insurers, but allocators estimate NetJets represents 65 to 70 percent of that figure.

The fix matters because fractional ownership remains the private aviation industry's highest customer-lifetime-value model. Jet-card holders churn at 22 percent annually; fractional owners churn at 9 percent, according to Argus International data. NetJets holds 750 aircraft under management, the largest such fleet globally, giving it pricing power in aircraft acquisition and preferential maintenance rates with Textron and Bombardier. VistaJet, its closest European competitor, operates 360 aircraft. The gap compounds: NetJets can absorb a $90 million Bombardier Global 7500 order at 12 percent below list, while smaller operators pay closer to 6 percent discounts. Johnson's margin expansion depends on keeping that scale advantage while competitors like Flexjet and Wheels Up consolidate post-bankruptcy.

Allocators should watch two threads. First, whether NetJets maintains utilization gains into the slower winter quarter starting November 2025, when corporate travel drops 19 percent seasonally. Second, whether Berkshire separates NetJets into standalone reporting by the May 2026 shareholder meeting. Buffett historically buries mistakes in Hathaway's "other" segments; visibility signals confidence. FlightSafety, also Berkshire-owned, began standalone reporting in 2019 after returning to growth.

NetJets now operates 82 aircraft in Europe and 41 in the Middle East, where it competes directly with sovereign-backed operators like Qatar Executive. The regional split matters because European fractional ownership carries 28 percent higher regulatory compliance costs than U.S. operations, per EASA filings. Johnson ran that higher-cost business profitably for three years before taking the global role. The structural test is whether he exports European pricing discipline—where NetJets charges $11,500 per flight hour versus $8,900 in the U.S.—without losing North American share to Sentient and XO, both of which undercut on hourly rates but lack fractional programs. If he does, Berkshire's aviation segment becomes a compounder rather than a Buffett curiosity.