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Warren Buffett’s Berkshire Hathaway Inc. reported lower third quarter profits after unrealized investment gains declined.
Berkshire
BRK.A,
BRK.B,
said Saturday that its third-quarter net earnings fell to $10.34 billion, or $6,882 per Class A share equivalent, from $30.14 billion, or $18,994 a share, in the same period a year earlier.
Operating earnings, which exclude some investment results, rose to $6.47 billion from $5.5 billion a year ago.
The conglomerate runs a large insurance operation as well as a railroad, utilities, industrial manufacturers, retailers and even auto dealerships. It also holds large investments, especially in the stock market. An accounting rule change in recent years has meant that Berkshire’s earnings often reflect the larger performance of the stock market, while operating earnings more accurately reflect the firm’s vast business operations.
The major U.S. stock indexes touched record highs in early September before slumping in the final weeks of the quarter as investors fretted over higher consumer prices and supply-chain bottlenecks. The S&P 500 index eked out its sixth-straight quarter of gains. Other benchmarks, including the Dow Jones Industrial Average, ended the period lower.
Losses from Berkshire’s insurance underwriting business widened to $784 million in the third quarter from $213 million a year ago. Insurance investment income rose to $1.16 billion from $1.02 billion.
The company’s railroad, utilities and energy units earned $3.03 billion, up from $2.74 billion in the year-earlier period.
Berkshire’s Class A shares closed Friday at $434,000. They have climbed 26% so far this year.
The company remained an active buyer of its own stock during the third quarter, spending about $7.6 billion on share repurchases. For the first nine months of the year, buybacks have totaled $20.2 billion.
