Berkshire Hathaway Earnings: Solid Results Despite Catastrophe Losses and Tariff Uncertainty

Morningstar’s Metrics for Berkshire Hathaway

• Class A Share Fair Value Estimate: $730,500.00
• Class B Share Fair Value Estimate: $487.00
• Morningstar Rating: ★★
• Morningstar Economic Moat Rating: Narrow
• Morningstar Uncertainty Rating: Low

What We Thought of Berkshire Hathaway‘s Earnings

With narrow-moat-rated Berkshire Hathaway BRK.A/BRK.B reporting adjusted first-quarter results that were about in line with our expectations, we are leaving our $730,500 per Class A share and $487 per Class B share fair value estimates in place.

First-quarter reported revenue, including unrealized and realized gains/losses from Berkshire’s investments and derivatives portfolios, declined 9.2% year over year to $83.3 billion, as $6.4 billion in investment losses and other adjustments had an impact on the company. Excluding the impact of these investment losses and other adjustments, first-quarter operating revenue declined 0.2% to $89.7 billion.

Operating earnings, exclusive of the impact of investment losses and other adjustments, declined 14.1% year over year to $9.6 billion during the March quarter. While most of the company’s segments posted solid operating earnings growth, significant losses from the Southern California wildfires during the period hit the insurance business. When including the effects of the investment losses and other adjustments, reported operating earnings decreased 63.8% to $4.6 billion from $12.7 billion in the first quarter of 2024.

Book value per share, which still serves as a decent proxy for measuring changes to Berkshire’s intrinsic value, increased 0.8% sequentially and 14.4% year over year to $455,055 (from $451,507 and $397,627 at the end of December 2024 and March 2024, respectively).

The company ended the first quarter with a record $333.3 billion in cash and cash equivalents, up from $321.4 billion at the end of last year. Free cash flow reached $6.2 billion in the quarter, and the company sold on a net basis $1.5 billion of its stock holdings and once again did not repurchase any of its own shares. Berkshire, by our estimates, had around $292 billion in dry powder—money that could be committed to investments, acquisitions, and share repurchases—at the start of the second quarter of 2025.