Warren Buffett’s conglomerate, Berkshire Hathaway, reported record profits in 2024, driven largely by a significant increase in its cash stockpile held at $334 billion, including $286 billion in short-term Treasuries. The move helped stabilize earnings despite declines at over half of the nearly 200 businesses it operates.
Buffett, known for his enthusiasm for undervalued stocks and businesses, is feeling bullish on Treasury bills, which he has said will never be preferred to owning good businesses. The conglomerate more than doubled its Treasury holdings from last year, largely due to the sale of a big chunk of its Apple stake, generating $26.8 billion in tax benefits.
Berkshire’s core business line, insurance, saw significant gains, while its operating earnings rose to $47 billion, up from $37 billion in 2023. Geico, Berkshire’s car insurance arm, moved from a nearly $2 billion loss to nearly $8 billion in earnings last year, thanks to the work of investment manager Todd Combs.
However, some businesses, such as Pilot Travel Centers and Dairy Queen, saw declines in earnings due to factors like lower fuel prices and changing consumer preferences. Berkshire finalized its hold on Pilot Travel Centers in 2017 but saw a drop in its earnings last year.
Despite this, Buffett remains optimistic about the company’s future, citing opportunities in Japan, where Berkshire has invested heavily. The conglomerate’s market valuation surpassed $1 trillion last year, and Buffett plans to step down as CEO eventually, with Greg Abel taking over.
The annual report also highlighted the importance of legacy businesses like Forest River, which contributed “many billions” to the wealth of Berkshire shareholders under the leadership of its founder, Pete Liegl.
Source: https://www.nytimes.com/2025/02/22/business/dealbook/berkshire-hathaway-earnings.html