- Warren Buffett's Berkshire Hathaway reported second-quarter earnings on Saturday.
- The investor's company was less active in the stock market and slowed its share buybacks.
- Berkshire posted double-digit increases in revenues and operating income.
Warren Buffett's Berkshire Hathaway reported second-quarter earnings on Saturday that showed a strong performance from its operating businesses, but revealed the company slowed its rate of share repurchases and was far less active in the stock market than in the preceding three months.
The famed investor's conglomerate posted a 10% year-on-year increase in revenues to about $76 billion, driving pre-tax earnings from its operating businesses up 16% to $10 billion. However, a $67 billion drop in the value of its investment portfolio meant Berkshire swung to a $43 billion net loss on a headline basis.
Buffett's company spent a net $3.8 billion on equities in the period, as it bought $6.2 billion worth and sold $2.3 billion worth. That represents a sharp slowdown from the net $41 billion it plowed into stocks in the first quarter. On the other hand, Berkshire was a net seller of stocks in both 2020 and 2021.
Berkshire spent only $1 billion on buybacks last quarter, down from about $3.2 billion in the first quarter, and upwards of $6 billion in each of the previous five quarters.
The reduced expenditures helped to keep Berkshire's cash pile almost flat at $105 billion. It shrunk by 28% to $106 billion in the first quarter.
Buffett and his team struggled to find bargains during the first two years of the pandemic, as stocks soared to record highs, private equity firms and special-purpose acquisition companies (SPACs) drove up the price of acquisitions, and Berkshire's climbing stock price made its shares less enticing to repurchase.
However, Berkshire has boosted its buying in recent months. It has plowed about $10 billion into Occidental Petroleum stock over the course of just 29 trading days this year. It also more than quadrupled its Chevron stake to around 8% in the first quarter, and struck a deal in under two weeks to acquire Alleghany for about $12 billion.