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Warren Buffet’s Berkshire Hathaway Report Earnings


Warren Buffett


Over the weekend, Warren Buffett's Berkshire Hathaway released earnings that exceeded analysts' expectations. Operating earnings for Berkshire Hathaway surged by 39% to reach $11.222 billion due to notable improvements in insurance underwriting and investment income.


Warren Buffett remains optimistic about the future, foreseeing modest growth in operating earnings for the full year. Revenue also experienced a healthy increase, rising by 5% to $89.87 billion, surpassing analysts' expectations of just over $87 billion. Net income witnessed a 64% decrease to $12.702 billion which outperformed analysts' expectations of a steeper 72% decline. The positive results prompted the stock to increase by 1% by the close of trading on Monday. Additionally, Berkshire repurchased $2.6 billion worth of its shares in Q1 and saw huge cash increases with the company's cash reserves reaching a new high of $188.99 billion. Buffett expects cash to hit $200 billion by the end of June.


These substantial increases in cash stem from various sources, one of which includes the recent sale of Paramount stock. Buffett revealed that Berkshire Hathaway had divested its entire holding in Paramount Global (PARA) at a loss. The company previously held 63.3 million shares of Paramount Class B as of the conclusion of 2023. Additionally, Berkshire Hathaway has been trimming down some of its massive stake in Apple. Ed Carson, Investors Business Daily author reported, “Warren Buffett and his investment team cut Berkshire's massive Apple (AAPL) stake for a second straight quarter. The company reported its Apple stake was worth $135.4 billion at the end of Q1, signaling a 13% decline in shares held to about 790 million. In Q4, Berkshire trimmed its Apple stake by 10 million shares.”


This indicates a notable reduction in Apple shares, which represent Berkshire's largest investment. Despite this trimming, Buffett expects Apple to remain their largest investment unless an unforeseen event occurs that prompts a fundamental shift in capital allocation. With nearly $200 billion in cash waiting to be deployed by Berkshire, Buffett stated, “We'd love to spend it, but we won't spend it unless we think they're doing something that has very little risk and can make us a lot of money.” He's adopting a cautious stance towards reallocating these funds, yet remains on the lookout for investments capable of delivering substantial returns in the years ahead.


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