Berkshire Hathaway, led by Warren Buffet, reported a significant increase in operating earnings in the first quarter of the year. The conglomerate’s operating profit, which includes earnings from wholly owned businesses, soared by 39% to $11.22 billion compared to the previous year. This impressive gain was primarily driven by a staggering 185% year-over-year increase in insurance underwriting earnings, which rose to $2.598 billion from just $911 million.

Geico, one of Berkshire’s subsidiaries, saw its earnings surge by 174% to $1.928 billion, a substantial increase from $703 million in the previous year. Additionally, the insurance investment income rose by 32% to over $2.5 billion. Berkshire’s railroad business generated a profit of $1.14 billion, slightly down from the first quarter of 2023. The energy division also performed well, nearly doubling its earnings to $717 million from $416 million in the previous year.

Net Earnings and Cash Holdings

Despite the impressive operating earnings, Berkshire reported a 64% decrease in first-quarter net earnings, which amounted to $12.7 billion. This figure includes fluctuations in Berkshire’s stock investments. The company’s cash reserves reached a record high of $188.99 billion, up from $167.6 billion in the previous quarter. This substantial cash holding indicates Buffett’s struggle to identify suitable major acquisition targets, a challenge he has acknowledged in recent years.

Stock Investments and Shareholder Meeting

In the first quarter, Berkshire reduced its stake in Apple by 13%. However, Apple remains the conglomerate’s largest stock holding. Berkshire also repurchased $2.6 billion in stock, an increase from $2.2 billion in the previous quarter. The company’s annual shareholder meeting, known as the “Woodstock for Capitalists,” will provide shareholders with insights into Berkshire’s holdings, Buffet’s investment strategies, and his economic outlook. Notably, this will be the first meeting since the passing of Vice Chairman Charlie Munger in November.

Year to date, Berkshire’s Class A shares have gained more than 11%, reaching an all-time high in late February. The Class B stock has also performed well, with an increase of over 12% during that period. Despite the challenges in finding suitable acquisitions and the fluctuations in net earnings, Berkshire Hathaway continues to deliver strong financial performance and remains a key player in the investment world.

Earnings

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