Berkshire Hathaway reports surge in earnings, questions arise over record cash pile

From CNBC: 2025-02-24 08:48:18

Warren Buffett’s Berkshire Hathaway reported a surge in operating earnings, causing shares to rise 1.2% premarket. Operating profit skyrocketed 71% to $14.5 billion, with insurance underwriting profits up 302%. Despite a slowdown in investment gains, Berkshire’s cash pile grew to a record $334.2 billion, prompting some to question Buffett’s strategy.

In Buffett’s annual letter, he defended the large cash position, citing high valuations as a reason for not making major moves in the market. He praised his successor Greg Abek’s abilities and reaffirmed his commitment to equities despite the cash hoard. Berkshire’s buyback halt continued in the fourth quarter and early 2025.

Investors and analysts expressed impatience with Buffett’s conservative stance, while others believe it will lead to opportunities in the next downturn. Berkshire had a strong 2024, outperforming the S&P 500, with shares up more than 5% in 2025. Chief investment officer Bill Stone reassured shareholders that Berkshire is positioned to thrive in any economic situation.

Read more: Berkshire advances on surge in earnings, but questions linger about cash