Berkshire Hathaway







recently announced a remarkable increase in fourth-quarter earnings from its operational sectors, significantly attributed to its insurance division, alongside a rise in cash reserves to record heights.

The conglomerate, spearheaded by Warren Buffett, reported that its operational profit, encompassing earnings from wholly owned enterprises, surged 71% to reach $14.527 billion in the last quarter of 2024. This hefty gain was primarily driven by a staggering 302% increase in insurance underwriting, totaling $3.409 billion, while insurance investment income saw a nearly 50% rise to $4.088 billion.

For the entire year, operational earnings increased by 27%, totaling $47.437 billion.

Buffett expressed in his annual letter to shareholders, “In 2024, Berkshire performed better than I anticipated, even though 53% of our 189 operational businesses reported declining earnings. We benefited from a significant increase in investment income, driven by improved Treasury Bill yields, and we notably expanded our holdings in these liquid short-term securities. Our insurance sector also achieved substantial earnings growth, particularly thanks to GEICO’s performance.”

Despite these positive results, Berkshire has indicated that the recent wildfires in Southern California are projected to incur a pre-tax loss of approximately $1.3 billion for its insurance operations.

As of the end of 2024, Berkshire Hathaway’s cash reserves stood at $334.2 billion, an increase from $325.2 billion at the close of the previous quarter. This financial fortification comes as Buffett continues to search for the next significant investment opportunity.

Addressing this substantial cash position in his annual correspondence, Buffett stated, “While some observers might view our current cash reserves as extraordinary, the overwhelming majority of your capital remains invested in equities. This strategy will not waver. Although our marketable equity stakes declined from $354 billion to $272 billion last year, the valuation of our non-quoted controlled equities has risen somewhat and remains significantly higher than our marketable portfolio’s value,” he added, reassuring shareholders that “a considerable portion of their investment will always be directed toward equities.”

Investment returns experienced a sharp decline in the fourth quarter, dropping to $5.167 billion from $29.093 billion the previous year. Throughout 2024, Berkshire reduced its stock investments, including a notable sale of part of its Apple shares.

It’s important to highlight that Berkshire consistently reminds investors through its earnings reports that “the fluctuations in investment gains or losses in any quarter are often inconsequential and can yield net earnings per share figures that may be misleading, particularly for those without in-depth accounting knowledge.”

The company’s total earnings for the last quarter amounted to $19.694 billion, reflecting a 47% decline compared to $37.574 billion from the same period last year. For the full year, overall earnings reached $88.995 billion, marking a 7.5% decrease from the $96.223 billion in 2023.