Warren Buffett’s Berkshire Hathaway recently released its first-quarter results, showcasing a significant decline in operating earnings compared to the previous year. The conglomerate, known for its diverse portfolio of businesses including insurance, transportation, energy, and retail, also expressed concerns about potential impacts from tariffs on its profitability.
Operating earnings for the first quarter dropped by 14% to $9.64 billion, down from $11.22 billion in the same period last year. On a per-share basis, operating earnings were reported at $4.47, a decrease from $5.20 per class B share in the previous year. This decline was primarily attributed to a sharp 48.6% decrease in insurance-underwriting profit, which fell to $1.34 billion due to losses incurred from the Southern California wildfires.
Additionally, Berkshire faced challenges from fluctuations in foreign exchange rates, resulting in a loss of approximately $713 million in the first quarter, compared to a gain of $597 million in the same period last year. The weakening of the dollar against other currencies, particularly the Japanese yen, further impacted the company’s financial performance.
The firm also highlighted the uncertainty surrounding President Donald Trump’s tariffs and geopolitical risks, which have created an unpredictable environment for businesses like Berkshire Hathaway. The company acknowledged the potential impact of these factors on its operations, citing concerns about changes in product costs, supply chain efficiency, and customer demand.
Despite these challenges, Berkshire’s cash reserves reached a record high of over $347 billion in the first quarter, indicating Buffett’s cautious approach to deploying capital amidst market volatility. The company remained a net seller of stocks for the 10th consecutive quarter, emphasizing its long-term investment strategy and advising investors to focus on overall performance rather than short-term fluctuations.
While Berkshire’s overall earnings declined by nearly 64% year over year, the company’s Class A shares outperformed the S&P 500, rising by nearly 19% in 2025. This strong performance amidst market uncertainty reflects Berkshire’s resilience and strategic investment decisions.
In conclusion, Berkshire Hathaway’s first-quarter results underscore the impact of external factors such as tariffs and foreign exchange on its financial performance. Despite these challenges, the company’s long-term investment approach and solid cash position position it well for future growth and value creation for shareholders.
â CNBC’s Yun Li contributed reporting.
