Berkshire Hathaway’s operating earnings plummeted by 14% to $9.64 billion in the first quarter, exceeding expectations as President Donald Trump’s tariffs and geopolitical risks continue to cast a shadow over the conglomerate.
The decline was largely driven by an 48.6% plunge in insurance-underwriting profit, which fell to $1.34 billion from $2.60 billion last year. The company attributed a $1.1 billion loss in Q1 to the Southern California wildfires.
Berkshire’s bottom line also took a hit due to a weakening dollar, resulting in an approximate $713 million loss related to foreign exchange. This contrasts with a $597 million forex gain last year, as the dollar index fell nearly 4% and against the Japanese yen it lost 4.6%.
The company warned that tariff uncertainty poses significant challenges, stating: “Considerable uncertainty remains as to the ultimate outcome of these events.” Berkshire’s cash hoard rose to over $347 billion, reflecting Buffett’s cautious approach amidst market volatility.
Notably, Berkshire’s overall earnings plunged nearly 64% year-over-year, driven by investment losses in Buffett’s portfolio. However, the company advised investors to focus on long-term performance rather than short-term fluctuations. Despite this, Class A shares of Berkshire are up nearly 19% year-to-date, outperforming the S&P 500’s 3.3% decline.
Source: https://www.cnbc.com/2025/05/03/berkshire-hathaway-brka-earnings-q1-2025.html