Over the period 2003–2010, the upper ocean has not gained any heat, despite the general expectation that the ocean will absorb most of the Earth's current radiative imbalance. Answering to what extent this heat was transferred to other components of the climate system and by what process(-es) gets to the essence of understanding climate change. Direct heat flux observations are too inaccurate to assess such exchanges. In this study we therefore trace these heat budget variations by analyzing an ensemble of climate model simulations. The analysis reveals that an 8-yr period without upper ocean warming is not exceptional. It is explained by increased radiation to space (45%), largely as a result of El Niño variability on decadal timescales, and by increased ocean warming at larger depths (35%), partly due to a decrease in the strength of the Atlantic meridional overturning circulation. Recently-observed changes in these two large-scale modes of climate variability point to an upcoming resumption of the upward trend in upper ocean heat content.