An Andy Warhol-like print of Berkshire Hathaway CEO Warren Buffett hangs outside a clothing stand during the first in-person annual meeting since 2019 of Berkshire Hathaway Inc in Omaha, Nebraska, U.S. April 30, 2022.
Scott Morgan | Reuters
Berkshire Hathaway on Saturday reported a big jump in third-quarter operating earnings, while sitting on a record amount of cash as Warren Buffett saw few dealmaking opportunities.
The Omaha-based conglomerate’s operating earnings — which encompass profits made from the myriad of wholly owned businesses such as insurance, railroads and utilities — totaled $10.761 billion last quarter. That’s 40.6% higher than the $7.651 billion earned from the same quarter a year ago.
Berkshire held a record level of cash at the end of September — $157.2 billion — topping the $149.2 billion high set in the third quarter of 2021.
The “Oracle of Omaha” has been taking advantage of surging bond yields, buying up short-term Treasury bills yielding at least 5%. The conglomerate owned $126.4 billion worth of such investments at the end of the third quarter, compared to about $93 billion at the end of last year.
Buyback activity continued to slow down as Berkshire shares roared to a record high during the quarter. The firm spent $1.1 billion to repurchase shares, bringing the nine-month total to approximately $7 billion.
Berkshire Class A shares have rallied nearly 14% this year. After reaching an all-time high on Sept. 19, shares have fallen about 6% from the peak.
Berkshire Hathaway Class A shares
Buffett’s company did post a significant investment loss of $24.1 billion in the third quarter, which largely came from a decline in its big Apple stake. Shares of the iPhone maker fell 11.7% during the quarter but have rebounded over 3% since.
As per usual, the “Oracle of Omaha” asked investors to look past the quarterly fluctuations in Berkshire’s equity portfolio.
“The amount of investment gains/losses in any given quarter is usually meaningless and delivers figures for net earnings (losses) per share that can be extremely misleading to investors who have little or no knowledge of accounting rules,” Buffett said in a statement.
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