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Berkshire Hathaway (NYSE:BRK.B) (NYSE:BRK.A) Q2 operating earnings rose 6.6% Y/Y, driven by strong gains in its insurance segment, both in underwriting and investment income.
The company bought back ~$1.4B of its common stock during the quarter, compared with $4.4B in the previous quarter, bringing its purchases in the first half of the year to $5.8B.
The investing giant had cash, cash equivalents and short-term U.S. securites amounting to $147.4B at June 30, 2023, up from $130.6B at March 31.
Q2 operating earnings of $10.0B increased from $8.07B in the previous quarter and $9.42B a year ago.
Insurance float stood at $166B at June 30, 2023, vs. $165B at March 31, 2023.
Operating earnings by business segment:
- Insurance – underwriting: $1.25B vs. $715M in Q2 2022; GEICO pretax underwriting earnings were $514M in Q2 2023 vs. a loss of $487M in the year-ago quarter;
- Insurance – investment income: $2.37B vs. $1.91B a year ago, primarily due to higher short-term interest rates, partly offset by lower dividend income;
- Berkshire Hathaway Energy: $1.26B vs. $1.66B in Q2 2022, primarily from lower overall freight volume and higher non-fuel operating costs, offset by lower fuel costs;
- Other controlled businesses: $3.50B vs. $3.25B;
- Non-controlled businesses: $535M vs. $182M a year ago;
- Other: $340M vs. $912M.
Investment and derivative gains, most of which are unrealized, were $25.9B in Q2 compared with a loss of $53.0B in the year-ago quarter. That resulted in net earnings of $35.9B in the most recent quarter compared with a loss of $43.6B a year ago. The most recent quarter included $1.6B of after-tax realized gains on the sale of investments and the year-ago quarter included $44M of after-tax realized losses.
As of June 30, 2023, about 78% of Berkshire Hathaway’s (BRK.B) $353.4B of equity holdings, at fair value were concentrated in five companies, compared with a 77% concentration of a $328.8B portfolio at March 31, 2023. The value in its stake in Apple (AAPL) outshone the rest of its biggest holdings.
Its Apple (AAPL) stake, at fair value, jumped to $177.6B from $151.0B at the end of Q2; Bank of America (BAC) at $29.6B vs. $29.5B; American Express (AXP) to $26.4B from $25.0B; Coca-Cola (KO) at $24.1B from $24.8B, and Chevron (CVX) to $19.4B from $21.6B.
Meanwhile, its stake in Occidental Petroleum (OXY) increased during the quarter, bringing the stake’s fair value to $13.2B at June 30, 2023 from $13.0B at March 31. And the value of its stake in Kraft Heinz (KHC) at $11.6B fell from $12.6B.
