Money
Berkshire profits drop after $5 billion Kraft write-down
Berkshire Hathaway’s profits plummet 59% as Buffett writes down $5 billion on Kraft Heinz investment before retirement
Berkshire Hathaway’s profits plummet 59% as Buffett writes down $5 billion on Kraft Heinz investment before retirement
In Short:
– Berkshire Hathaway’s profits dropped due to a $5 billion writedown on Kraft Heinz, with net earnings at $12.37 billion.
– The company remains a net seller of stocks, with cash reserves at $344.1 billion and no share repurchases.
– Berkshire Hathaway’s profits dropped due to a $5 billion writedown on Kraft Heinz, with net earnings at $12.37 billion.
– The company remains a net seller of stocks, with cash reserves at $344.1 billion and no share repurchases.
Warren Buffett’s Berkshire Hathaway has reported a significant drop in quarterly profits, primarily due to a $5 billion writedown on its Kraft Heinz investment.
Net earnings fell to $12.37 billion from $30.348 billion a year prior, marking Buffett’s first earnings report following his retirement announcement.
According to Business Insider, operating earnings also decreased by 4%, highlighting ongoing challenges for the conglomerate.
The writedown reduced Berkshire’s Kraft Heinz stake to $8.4 billion, reflecting a 65% value loss since their $24.6 billion investment in the merger.
Buffett has acknowledged overpaying for the company amid competitive pressures from private labels and shifting consumer preferences.
Cash Reserves
Despite these declines, Berkshire remains a net seller of stocks, having offloaded $6.9 billion while purchasing $3.9 billion.
This has kept cash reserves substantial at $344.1 billion, surpassing the market caps of firms like Coca-Cola.
The company also abstained from repurchasing its shares during the quarter, perceiving high valuations.
