Berkshire's profit plunges 64% on portfolio holdings as Buffett sells Apple
Berkshire Hathaway says its first quarter profit plummeted on the paper value of its investments
OMAHA, Neb. — Berkshire Hathaway's first quarter profits plummeted along with the paper value of its investments, but the company said Saturday that most of the businesses it owns outright performed well.
The company reported reported a $12.7 billion profit, or $8.825 per Class A share, in the quarter. That’s roughly one-third of last year's $35.5 billion, or $24,377 per A share.
The figures were heavily influenced by a large drop in the paper value of Berkshire’s investments. Buffett encourages investors to pay more attention to the conglomerate’s operating earnings that exclude the investment figures. Operating earnings jumped 39% to $11.222 billion from last year’s $8.065 billion as its insurance companies showed strong results.
On a per share basis, this year's first quarter operating figure amounts to $7,796.47 per Class A share, beating three analysts' estimates by FactSet Research, who predicted $6,701.87 per Class A share.
Buffett was a net seller of $17 billion in stocks during the quarter, including trimming about 13% of Berkshire’s massive Apple stake. At $135.4 billion, the iPhone maker still accounts for the biggest share of Berkshire's $364 billion portfolio. Buffett said he expects it to remain so even up to when his successor Greg Abel takes over.
The estimated value of Berkshire’s Apple stake suggests Buffett sold off more than 100 million shares. In the past, Buffett has said he invested in Apple’s stock because of how devoted consumers are to the company's products, similar to consumer brands he loves like Berkshire's own See's Candy.
Apple CEO Tim Cook, who is at the Berkshire meeting, told CNBC that he
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