Berkshire Hathaway Inc. BRK BRK posted a 3.8% decline in second-quarter working earnings, dragged down by weak insurance coverage underwriting and a hefty $3.8 billion impairment tied to its stake in The Kraft Heinz Firm KHC.
Nonetheless, different elements of Warren Buffett’s sprawling conglomerate helped cushion the blow.
Insurance coverage underwriting income fell 12% year-over-year to $1.99 billion, with reinsurance losses offsetting modest beneficial properties at GEICO.
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In distinction, BNSF Railway noticed a rebound with 19.5% development yr over yr to $1.47 billion, logging sturdy earnings development on the again of improved freight volumes and higher pricing.
Nonetheless, BNSF’s excellent debt was $23.9 billion as of June 30, 2025 a rise of $355 million since December 31.
Berkshire Hathaway Vitality delivered regular outcomes with 7.2% development to $702 million, supported by regulated utilities that supplied a buffer amid broader market uncertainty.
Berkshire didn’t repurchase any of its personal shares through the interval.
The agency’s earnings report highlighted that it’s going to not repurchase inventory if it reduces consolidated money, money equivalents and U.S. Treasury Payments holdings to beneath $30 billion.
However Berkshire affirmed that it could “repurchase its shares any time that Warren Buffett, Berkshire’s Chairman of the Board and Chief Govt Officer, believes that the repurchase value is beneath Berkshire’s intrinsic worth, conservatively decided.”
On this regard, The Wall Avenue Journal quoted CFRA Analysis analyst Cathy Seifert, “Towards the backdrop of very mediocre outcomes, the shortage of buybacks doesn’t ship a very assured or inspiring message for traders trying to get again into the inventory.”
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An Edward Jones analyst, Kyle Sanders informed Reuters, “Buyers are getting antsy and need to search exercise, and nothing is occurring. Buffett undoubtedly views the market as overvalued, and can sit again and watch for one thing to come back to him.”
On the buyer aspect, Berkshire’s outcomes had been extra blended. Shopper merchandise group revenues declined 5.1% yr over yr.
12 months-to-date revenues declined at Fruit of the Loom (down 11.7%), Garan (down 10.1%) and Jazwares (down 38.5%), primarily attributable to decrease volumes, together with the impacts of enterprise restructurings and uncertainties arising from worldwide commerce insurance policies and tariffs, which produced delays in orders and shipments, significantly within the second quarter.
Service group revenues elevated 8.9% within the second quarter, with p pre-tax earnings rising 15.2%.
Berkshire stated that shareholders’ fairness at June 30 was $668 billion, a rise of $18.6 billion since December 31, 2024.
Nonetheless, essentially the most eye-catching determine stays Berkshire’s rising money reserves.
As of June 30, the agency sat on $344.1 billion, just under the March report. With valuations cooling and rates of interest nonetheless elevated, analysts speculate that Berkshire may goal acquisitions throughout sectors—starting from mid-sized insurers and industrials to vitality infrastructure and even logistics.
“He most likely feels that there’s much less alternative to allocate their capital in the meanwhile and he’s talked about being affected person,” Macrae Sykes, a portfolio supervisor at Gabelli, which owns Berkshire shares informed The Wall Avenue Journal. “That’s a continuation of the final a number of quarters.”
As Buffett prepares to step apart on the finish of 2025, successor Greg Abel could also be poised to place a few of that struggle chest to work, reshaping Berkshire’s dealmaking legacy in a brand new period.
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