Berkshire Hathaway, the massive conglomerate run by billionaire Warren Buffett, posted a nearly $50 billion net loss in the first quarter — the biggest loss ever for the storied company.
Berkshire, which owns companies including Geico auto insurer, Burlington Northern Santa Fe railroad, Dairy Queen, Duracell and many other financial, industrial and consumer firms, has been hit hard by the Covid-19 pandemic. Just like the rest of the market and economy.
The company said in a regulatory filing Saturday morning that before the coronavirus hit the United States in mid-March, many of Berkshire’s businesses were posting revenue and earnings increases compared to a year ago. But that quickly changed.
“As efforts to contain the spread of the COVID-19 pandemic accelerated in the second half of March and continued through April, most of our businesses were negatively affected, with the effects to date ranging from relatively minor to severe,” Berkshire said in the filing.
Warren Buffett to talk investment strategy – Wall Street is listening
The company’s overall revenue rose slightly from the year ago quarter, to $61.3 billion. But Berkshire said Saturday that the essential businesses it owns — its railroad, utilities and energy, and insurance units, “slowed considerably in April.”
And, the company, added “several of our retailing businesses and certain manufacturing and service businesses are being severely impacted due to closures of facilities where crowds can gather, such as retail stores, restaurants, and entertainment venues.”
Berkshire’s operating earnings, a measure that Buffett prefers to focus on, fared better. Operating profits rose nearly 6% to $5.9 billion in the quarter.
Shares of Berkshire Hathaway are down nearly 20% so far this year.
Buffett is arguably most famous as an investing guru. Berkshire Hathaway currently owns large stakes in top American blue chip companies Apple, Bank of America, Coca-Cola, Wells Fargo and Kraft Heinz. He is currently worth about $72 billion according to Forbes.
Berkshire Hathaway’s shareholder meeting takes place Saturday afternoon, and Buffett will take questions from shareholders and a few reporters in a virtual meeting that will be livestreamed exclusively on Yahoo Finance.
