May 18, 2022

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Berkshire Hathaway reports profit decline driven by investment losses

Berkshire Hathaway reports profit decline driven by investment losses

The company’s financial filings also showed that Berkshire had significantly increased its investment in oil giant Chevron to nearly $26 billion at the end of the first quarter, up from just $4.5 billion at the end of 2021. It trailed Apple, Bank of America and American Express. Mr. Buffett recently placed big bets on the energy sector. Last month, the company also bought $7 billion worth of shares in Occidental Petroleum.

Sales and earnings in Berkshire’s operating business continued to rise during the quarter, defying the overall The downturn in the US economy in the first quarter. Economists said, however, that the decline in GDP masked some underlying strength in the US economy, and Berkshire’s operating results appear to support that. Profits in Berkshire’s manufacturing and retail business are up 16 per cent compared to the same period last year. Profits for Burlington Northern railroad company, one of the largest freight networks in the United States, rose 9 percent, again reflecting continued business.

Berkshire’s mixed first-quarter results came as tens of thousands of loyal Buffett investors flocked to Omaha, his hometown, for the company’s annual meeting. The Buffett Festival is a popular day-long event, often called the “Woodstock of the Capitalists,” in which Buffett spends hours answering questions in front of a crowd in the 17,000-seat downtown plaza. While there were some empty seats, there were several corporate notables, including Tim Cook, CEO of Apple, Jamie Dimon, CEO of JPMorgan Chase, as well as Bill Ackman, head of hedge fund Pershing Square Capital Management. Actor Bill Murray.

The floor of the giant conference room is filled with booths highlighting many of Berkshire’s businesses, offering discounts on things like See’s Candies, also owned by Berkshire. On Saturday, Buffett said from the platform that See’s brought 11 tons of candy to its shareholder meeting, and it is expected to sell. Only contributors can attend in person. The meeting has been virtual for the past two years. Berkshire began broadcasting the meeting a few years ago, and will be back again this year.

Mr Buffett, 91, faces a slightly more contentious annual meeting than usual, despite the fact that Berkshire shares, which are up about 8 per cent this year, have outperformed the market as a whole, which is down 13 per cent. “Historically, Berkshire stocks have outperformed during periods of economic distress as investors ‘flighted to quality,'” Kathy Seifert, an analyst at CFRA Research who tracks Berkshire, wrote in a note to clients last week.