Berkshire Hathaway's Q1 Operating Earnings Surged 39% — Here's Why

Zinger Key Points
  • Berkshire Hathaway's Q1 operating earnings soar 39% to $11.22 billion, boosted by robust insurance and investment income.
  • Net earnings drop to $12.702 billion from $35.504 billion due to investment losses, but insurance underwriting and investment income rise.

Berkshire Hathaway Inc. BRK BRK, on Saturday, registered a solid increase in first-quarter operating earnings, driven by strength in its insurance businesses, both in underwriting and investment income.

The Omaha-based company's quarterly operating earnings of $11.22 billion rose over 39% from $8.065 billion in the year-ago quarter.

At the end of the quarter, the company said approximately 75% of the aggregate fair value was concentrated in five companies:

  • American Express Company AXP – $34.5 billion
  • Apple Inc. AAPL – $135.4 billion
  • Bank Of America Corporation BAC – $39.2 billion
  • Coca-Cola Company KO: – $24.5 billion
  • Chevron Corporation CVX – $19.4 billion

The company’s cash and equivalents as of March end stands at $28.891 billion,

Q1 Net Earnings In Detail: In the first quarter of 2024, investment losses totaled approximately $9.7 billion, while gains amounted to around $23.4 billion in the same period of 2023. 

These gains and losses were primarily due to changes in unrealized gains in equity security investments. 

Additionally, after-tax realized gains from investment sales were $11.2 billion in the quarter under review, compared with $1.7 billion in the year-ago period. 

Net earnings attributable to Berkshire shareholders decreased to $12.702 billion from $35.504 billion a year ago.

Segmental Analysis: In the quarter under review, insurance underwriting generated earnings of $2.59 billion versus $911 million year over year.

Earnings from insurance-investment income totaled $2.598 billion compared with $1.969 billion in the year-ago period.

Berkshire Hathaway Energy Company generated first quarter earnings of $717 million, higher than $416 million a year ago.

Other controlled businesses earnings in the first quarter totaled $3.088 billion, which is higher than the $3.065 billion in the first quarter of 2023.

Approximately $2.6 billion was used to purchase shares of Class A and Class B common stock during the first quarter of 2024.

Approximately $2.6 billion was used to purchase shares of Class A and Class B common stock during the first quarter of 2024. 

On March 31, there were 1,437,251 Class A equivalent shares outstanding. The insurance float (the net liabilities we assume under insurance contracts) was approximately $168 billion.

Warren Buffett, 93, is one of the best-known fundamental investors in the world. Known as the “Oracle of Omaha,” he has a real-time net worth is $131.7 billion. 

Price Action: BRK/B shares closed higher by 0.07% to $400.87 on Friday; shares were up by 0.26% after hours.

Read Next: Warren Buffett’s Annual Secret Berkshire Hathaway Movie To Be Shown Publicly For First Time: Could This Be The Ultimate Tribute To Charlie Munger?

Photo: Shutterstock

Market News and Data brought to you by Benzinga APIs
Posted In: EquitiesNewsMarketsMoversGeneralBerkshireEarningsWarren Buffet
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!