Berkshire Hathaway Reports Drop in Earnings, Driven by Investment Losses

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The company’s financial filings also showed that Berkshire had dramatically increased its investment in the oil company giant Chevron to nearly $26 billion at the end of the first quarter, up from just $4.5 billion at the end of 2021. That made Chevron Berkshire’s forth largest holding, behind Apple, Bank of America and American Express. Mr. Buffett has recently been making big bets on the energy sector. Last month, the company also bought $7 billion in shares of Occidental Petroleum.

Sales and profits at Berkshire’s operating businesses continued to rise in the quarter, bucking the overall contraction in the U.S. economy in the first quarter. Economists said, though, that the drop in gross domestic product hid some underlying strength in the U.S. economy, and Berkshire’s operating results seemed to back that up. Profits at Berkshire’s manufacturing and retail businesses rose 16 percent from the same period a year ago. Profits at its railroad company Burlington Northern, one of the largest freight networks in the United States, were up 9 percent, again reflecting continued business activity.

Berkshire’s mixed first-quarter results came as tens of thousands of Mr. Buffett’s loyal investors have flocked to Omaha, his hometown, for the company’s annual meeting. The Buffett-fest is a daylong folksy affair, often called “Woodstock for Capitalists,” in which Mr. Buffett spends hours answering questions in front of a packed crowd in the city’s downtown 17,000-seat arena. A giant conference room floor is filled with booths highlighting Berkshire’s many companies, and offering discounts on things like boxes of See’s Candies, also owned by Berkshire. Mr. Buffett said on Saturday from the stage that See’s had brought 11 tons of candy to the shareholder meeting, and expected to sell out. Only shareholders can attend in person. The meeting has been virtual for the past two years. Berkshire began streaming the meeting a few years ago, and will again this year.


April 29, 2022, 6:32 p.m. ET

Mr. Buffett, 91, faces a slightly more contentious annual meeting than usual, despite the fact that Berkshire’s shares, up nearly 8 percent this year, have outperformed the overall market, which is down 13 percent. “Historically, Berkshire shares have outperformed during periods of economic distress as investors made a ‘flight to quality,’” Cathy Seifert, an analyst at CFRA Research who follows Berkshire, wrote in a note to clients this past week.

Dissident shareholders have put up a proposal for vote that asks Berkshire to overhaul how it views and details its climate risk, something Mr. Buffett has resisted doing. They say Berkshire Hathaway Energy, which manages a number of large utilities, has lagged rivals in lowering emissions. The climate proposal has the support of many larger shareholders outside of Mr. Buffett’s inner circle, including BlackRock, Vanguard and State Street.