The conglomerate reported on Saturday that it had cut its holdings in Apple and Bank of America and increased its cash to a record high in the third quarter.
Berkshire Hathaway, the conglomerate headed by Warren E. Buffett, extended its retreat from stocks in the third quarter, cutting its holdings in Apple and Bank of America and increasing its cash to a record $325.2 billion.
Berkshire also reported on Saturday a 6 percent decline in quarterly operating profit, largely the result of higher liabilities for its insurance companies, including for Hurricane Helene, and currency losses from a strengthening U.S. dollar.
These costs offset improved profitability at the Geico car insurer, where accident claims and expenses fell. Profit also rose at the BNSF railroad, which shipped more consumer goods, and Berkshire Hathaway Energy, where operating expenses declined.
In its quarterly report, Berkshire said it sold about 100 million of its Apple shares, or 25 percent, over the summer, ending with about 300 million shares.
It has now sold more than 600 million Apple shares this year, though Apple remained Berkshire’s largest stock holding, at $69.9 billion.
The sales represented a large portion of the $36.1 billion of stock, including several billion dollars of Bank of America shares, that Berkshire sold in the quarter.
Mr. Buffett said in May that he expected Apple to remain Berkshire’s largest stock investment, but selling made sense because the 21 percent federal tax rate on the capital gains was likely to increase.
Berkshire bought just $1.5 billion of stock in the quarter, the eighth straight quarter when it was a net seller of stocks.
It also repurchased none of its own stock, suggesting that Mr. Buffett doesn’t view even his own company’s shares as a bargain.
Operating profit from Berkshire’s dozens of businesses fell to $10.09 billion, from $10.76 billion a year earlier.
Insurance underwriting profit fell 69 percent, hurt by rising claims, $565 million of losses from Helene and a bankruptcy court settlement related to the defunct talc supplier Whittaker Clark & Daniels. The costs more than offset a near doubling of underwriting profit at Geico. Berkshire also projected $1.3 billion to $1.5 billion in pretax losses in the fourth quarter from Hurricane Milton, which hit Florida in October.
Net income for Berkshire totaled $26.25 billion compared with a loss of $12.77 billion a year earlier when falling stock prices reduced the value of Berkshire’s investments.
Mr. Buffett has said operating results better reflect Berkshire’s performance. Accounting rules require Berkshire to report unrealized investment gains and losses when it reports net income, adding volatility that Mr. Buffett counsels investors to ignore.
Mr. Buffett, 94, has led Berkshire since 1965, and is expected to eventually transfer leadership to Berkshire’s vice chairman, Greg Abel, 62.
Berkshire, based in Omaha, owns and operates an array of businesses, including Berkshire Hathaway Energy, many industrial and manufacturing companies, a big real estate brokerage, and retail businesses like Dairy Queen, See’s Candies and Fruit of the Loom.
Source: Elections - nytimes.com
