Berkshire Hathaway’s Annual Shareholders Meeting 2023

Berkshire Hathaway makes a profit of $35.5 billion and has $130 billion in cash on hand.

Berkshire Hathaway (BRK.A; BRK.B), which is owned by Warren Buffet, made a $35.5 billion profit in the first quarter and increased the amount of cash it had on hand. This was because its insurance business improved and bets on stocks paid off.

Key Takeaway 

  • Even though there was a problem in the banking system last quarter and Berkshire wasn’t buying anything, the Oracle of Omaha still had faith in the United States.
  • Berkshire sold stock worth billions of dollars and now has more than $130 billion in cash.
  • Buffett said letting SVB depositors fail would’ve been ‘catastrophic’

    Tens of thousands of people met in Omaha, Nebraska, on Saturday for the company’s annual meeting, which was called “Woodstock for Capitalists.” Buffett and co-Chair Charlie Munger spoke about the company’s first-quarter results and the economy.

    Berkshire Hathaway made a profit of $35.5 billion in the first quarter. Its insurance business and growth in Apple (AAPL) stock helped it make this profit. The conglomerate’s operating income was $8.1 billion, which was 12.6% more than the year before. Berkshire sold billions of dollars’ worth of stock in the first quarter and added $2 billion to its cash pile. This shows that the company is currently putting more value on cash than on stock purchases.

    Berkshire’s biggest equity holding is in Apple, which Buffett said is “better than any business” Berkshire owns outright. He also said that the “moat” of customers makes the iPhone a “extraordinary product.” The fact that iPhone sales did better than expected in the first quarter sent Apple stock up almost 5% on Friday. A few years ago, Buffet said that selling some of the company’s stock to pay taxes was a “dumb decision.”

    Buffett and Munger said that higher interest rates would hurt business real estate, which they saw as a bad sign. Munger told the Financial Times last month that banks were “full” of bad commercial real estate loans and that investors should lower their hopes for stock returns.

    But the two were hopeful that the sector’s problems could give them, as well-known value investors, chances to make money in the future. “In the 58 years we’ve been running Berkshire, I’d say the number of people doing stupid things has gone up a lot, and they do stupid things on a big scale,” Buffett said.

    Berkshire is set up to take advantage of these bad choices. The company has $130,6 billion in cash on hand, which is the most it has had since 2021.

    Buffett explained why Berkshire decided to sell most of its $4 billion stock in Taiwan Semiconductor (TSM) by saying that Taiwan is a source of tension between China and the United States. He said that TSMC was “one of the best-managed and (most) important companies in the world,” but he said that he “felt better” about how the company used its cash in Japan.

    At the yearly meeting, investors also asked questions about the rise of artificial technology. Buffett said that AI can change “everything in the world except how men think and act.” Munger said that he is “skeptical of some of the hype in AI,” and that “old-fashioned intelligence works pretty well.”

    In response to a question about the standoff over the U.S. debt ceiling, Buffett said that he doesn’t see how the U.S. government could let “the debt ceiling cause the world to go into turmoil.”

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