Warren Buffett and his company, Berkshire Hathaway, have continued to pull back from the stock market.
In the third quarter, Berkshire significantly reduced its investment in Apple, selling 100 million shares — about 25% of its stake — and increasing its cash reserves to a record $325.2 billion.
Despite cutting down on Apple holdings, the tech giant remains Berkshire’s largest stock investment, valued at $69.9 billion.
Since the start of 2024, Berkshire has sold over 600 million Apple shares. Additionally, the company sold $36.1 billion worth of stock in the quarter, including a substantial amount of Bank of America shares.
Buffett had previously indicated that Apple would stay as Berkshire’s top investment but noted that selling was logical because of the 21% federal tax on capital gains, which may increase in the future.
Berkshire only bought $1.5 billion in stocks over the quarter, marking the eighth consecutive quarter as a net stock seller.
Interestingly, the company did not repurchase any of its own shares, suggesting Buffett doesn’t see even Berkshire’s stock as a particularly good deal at the moment.
The company’s quarterly operating profit declined by 6%, dropping to $10.09 billion from $10.76 billion in the previous year.
This drop was primarily driven by increased insurance claims and currency losses due to a stronger U.S. dollar.
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Losses from Hurricane Helene and a settlement involving a defunct talc supplier further strained profits. However, there were some bright spots: Geico car insurance reported a significant boost in profitability, and Berkshire Hathaway Energy benefited from reduced operating expenses. The BNSF railroad also performed well, transporting more consumer goods.
The company anticipates further losses of $1.3 billion to $1.5 billion in the fourth quarter due to Hurricane Milton, which struck Florida in October.
Berkshire’s net income rose to $26.25 billion, rebounding from a $12.77 billion loss a year earlier, which was affected by falling stock prices.
Buffett emphasizes that operating profits are a better measure of the company’s performance, as accounting rules require Berkshire to report fluctuations in investment value as part of net income, causing significant volatility.
Buffett, now 94 years old, has led Berkshire since 1965. When he eventually steps down, Vice Chairman Greg Abel, 62, is expected to take over.
The Omaha-based conglomerate operates a wide range of businesses, including Berkshire Hathaway Energy, manufacturing and industrial companies, a real estate brokerage, and well-known brands like Dairy Queen and Fruit of the Loom.
