(Reuters) — Warren Buffett’s Berkshire Hathaway said Saturday that its operating profit set a record in the fourth quarter and for the third straight calendar year, bolstered by improved underwriting and higher investment income in its insurance businesses.
Much of that income came from Berkshire’s enormous cash stake, which ended 2024 at a record $334.2 billion, twice as much as a year earlier.
While overall insurance underwriting profit quadrupled in the fourth quarter, Berkshire projected a $1.3 billion pre-tax hit from last month’s wildfires in the Los Angeles area.
In his annual letter to Berkshire shareholders, the 94-year-old Mr. Buffett said the company would prefer investing in businesses to holding cash.
But he also said the Omaha, Nebraska-based conglomerate “did better than I expected,” though 53% of its 189 operating businesses posted lower earnings.
He attributed the improvement in part to higher yields on U.S. Treasury bills, and improvement at the Geico car insurer, which benefited from improved pricing and tighter underwriting as loss rates from accidents declined.
“Those were incredible numbers,” said Thomas Russo, a partner at Gardner Russo & Quinn in Lancaster, Pennsylvania, which has owned Berkshire stock since the 1980s. “You really saw the power of Berkshire’s insurance operations and investments.”
Operating profit rose 71% to $14.53 billion in the fourth quarter, and 27% to $47.44 billion in 2024.
Quarterly net income totaled $19.69 billion, or $13,695 per average equivalent share, as the value of Berkshire’s holdings in Apple, American Express and other stocks increased. For the year, net income totaled $89 billion.
Mr. Buffett considers net results misleading because they include gains and losses on investments that Berkshire has not sold and sometimes has no plan to sell.
