{"id":1726366,"date":"2022-11-06T06:11:06","date_gmt":"2022-11-06T11:11:06","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1726366"},"modified":"2022-11-06T20:36:27","modified_gmt":"2022-11-07T01:36:27","slug":"warren-buffets-berkshire-hathaway-posts-2-69-billion-loss-in-q3","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/warren-buffets-berkshire-hathaway-posts-2-69-billion-loss-in-q3\/","title":{"rendered":"Warren Buffet&#8217;s Berkshire Hathaway Posts $2.69 Billion Loss in Q3"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">20<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fwarren-buffets-berkshire-hathaway-posts-2-69-billion-loss-in-q3%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1726366&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/11\/1c2cc73f162bf39b935db5464ef879f9\" class=\"ff-og-image-inserted\" alt=\"image\" \/><\/div>\n<p>By Jonathan Stempel<\/p>\n<p>(Reuters) &#8211; Warren Buffett&#8217;s Berkshire Hathaway Inc on Saturday posted a $2.69 billion third-quarter loss as rising inflation, falling stock investments and a big loss from Hurricane Ian offset improvement in many of the conglomerate&#8217;s businesses.<\/p>\n<p>Operating profit nevertheless rose by 20%, topping analyst forecasts.<\/p>\n<p>Berkshire benefited from increased demand and prices for new home sales, industrial products and energy, while the U.S. Federal Reserve&#8217;s inflation-fighting campaign helped Berkshire generate more income from insurance investments.<\/p>\n<p>&#8220;On balance, results were strong and demonstrated resilience given the impact of inflation, higher interest rates and supply chain challenges,&#8221; said Jim Shanahan, an Edward Jones &#038; Co analyst with a &#8220;buy&#8221; rating on Berkshire.<\/p>\n<p>Buffett&#8217;s company took advantage of declining equity markets to add more stocks to its $306 billion portfolio, buying a net $3.7 billion and building a now 20.9% stake in Occidental Petroleum Corp.<\/p>\n<p>Berkshire also bought back more of its own stock but was cautious, repurchasing $1.05 billion, similar to the second quarter. It also bought back some stock in October.<\/p>\n<p>The conservatism may reflect the &#8220;significant disruptions&#8221; that Berkshire said its several dozen businesses still see from supply chains and events beyond their control, such as the COVID-19 pandemic and Russia-Ukraine conflict.<\/p>\n<p>Berkshire also said rising costs from fuel and accidents hurt respective results at two of its best-known businesses, the BNSF railroad and Geico auto insurer.<\/p>\n<p>Cathy Seifert, a CFRA Research analyst with a &#8220;hold&#8221; rating for Berkshire, said the company may be &#8220;at an inflection point, not unlike the economy,&#8221; where it will need to contain costs to prepare for slowing demand and a possible recession.<\/p>\n<p>&#8220;Bottom line, this was a healthy quarter, but one needs to be concerned over its trajectory over the next 12 months,&#8221; Seifert said.<\/p>\n<p>HUNKERING DOWN<\/p>\n<p>The quarterly net loss equaled $1,832 per Class A share, and compared with a profit of $10.34 billion, or $6,882 per share, a year earlier.<\/p>\n<p>Results included $10.45 billion of losses from investments and derivatives, as the stock prices of many large Berkshire investments other than Apple Inc fell.<\/p>\n<p>Accounting rules require Berkshire to report such changes even if it buys and sells nothing. This causes large quarterly swings in results that Buffett says are usually meaningless.<\/p>\n<p>Operating profit, meanwhile, rose to $7.76 billion, or about $5,294 per Class A share, from $6.47 billion, or $4,331 per share, a year earlier.<\/p>\n<p>Results improved despite a $2.7 billion after-tax loss from Ian, a strong Category 4 hurricane that slammed into Florida on Sept. 28. Revenue rose 9%, while expenses rose 7%.<\/p>\n<p>&#8220;The concern is which of the rising expenses are going to become more permanent,&#8221; said Tom Russo, a partner at Gardner, Russo &#038; Quinn in Lancaster, Pennsylvania, who invests more than $1 billion in Berkshire.<\/p>\n<p>Russo said results reflect &#8220;an enterprise hunkering down and conserving resources while it awaits large &#8216;elephants,'&#8221; a term Buffett uses to describe large acquisitions.<\/p>\n<p>Berkshire ended September with $109 billion of cash, up from $105.4 billion in June, though it spent $11.6 billion last month to buy the Alleghany Corp insurance business.<\/p>\n<p>A strengthening U.S. dollar led to $858 million of third-quarter gains from Berkshire&#8217;s non-dollar-denominated debt.<\/p>\n<p>Meanwhile, the Fed&#8217;s aggressive raising of short-term interest rates fueled a 21% increase in insurance investment income, with income from U.S. Treasuries and other debt nearly tripling to $397 million.<\/p>\n<p>BNSF, GEICO<\/p>\n<p>Profit at BNSF fell 6% as expenses jumped by one-third, including increases of 27% for compensation and 80% for fuel, some of which was passed on to customers through surcharges.<\/p>\n<p>Geico suffered its fifth straight quarterly underwriting loss, losing $759 million before taxes, reflecting more frequent and costly accident claims, rising used car prices and car parts shortages. Written premiums barely changed.<\/p>\n<p>Seifert said Geico, run by Berkshire portfolio manager Todd Combs, has fared worse than many other auto insurers, and may suffer further erosion in underwriting if its &#8220;limited revenue growth and claims cost inflation&#8221; persists.<\/p>\n<p>Offsetting the declines were profit increases of 6% from Berkshire Hathaway Energy and 20% from manufacturing, service and retail businesses including Clayton Homes, though rising mortgage rates will likely cut into future home sales.<\/p>\n<p>Berkshire also said rising rates may significantly lower any reduction in shareholder equity resulting from an upcoming accounting change for some insurance contracts.<\/p>\n<p>Buffett, 92, has run Berkshire since 1965.<\/p>\n<p>Investors closely watch Berkshire because of his reputation, and because results often mirror broader economic trends.<\/p>\n<p>The company also owns familiar consumer brands such as Dairy Queen, Duracell, Fruit of the Loom and See&#8217;s Candies.<\/p>\n<p>(Reporting by Jonathan Stempel in New York; Editing by Mark Potter, Chizu Nomiyama and Jonathan Oatis)<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Jonathan Stempel(Reuters) &#8211; Warren Buffett&#8217;s Berkshire Hathaway Inc on Saturday posted a $2.69 billion third-quarter loss as rising inflation, falling stock investments and a big loss from Hurricane Ian<\/p>\n","protected":false},"author":1,"featured_media":1726379,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[547],"tags":[],"class_list":["post-1726366","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-bongino-report"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1726366","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1726366"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1726366\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1726379"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1726366"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1726366"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1726366"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}