Berkshire Hathaway Hits $397 B Cash, $1.7 B Underwriting Profit Spurs Buybacks
Berkshire Hathaway’s cash pile climbed to a record $397 billion in Q1 as CEO Greg Abel sold $8.1 billion of equity holdings, while operating earnings rose on improved insurance underwriting results. The conglomerate also repurchased $234.2 million of shares, its first buybacks in over a year.
1. Record Cash Pile
In the first quarter, Berkshire Hathaway’s cash and equivalents reached a historic $397 billion after the firm offloaded a net $8.1 billion of equity holdings, marking its largest cash hoard ever under new CEO Greg Abel.
2. Insurance Underwriting Strength
Operating earnings benefited from a 29% surge in underwriting profits to $1.7 billion, driven by improved performance across its insurance units, although Geico’s pretax underwriting earnings fell by 35% due to increased spending for new clients.
3. Share Repurchases Resume
Berkshire repurchased $234.2 million of its own shares in Q1, the first buybacks in over a year, reflecting management’s view that intrinsic value exceeds market valuation as shares have declined 5.9% year-to-date.
4. CEO Transition and Investor Sentiment
Greg Abel’s inaugural quarterly report as CEO has started imprinting his strategy on the $1 trillion conglomerate, but some investors remain cautious after Warren Buffett’s retirement announcement and recent underperformance relative to the broader market.