Berkshire Hathaway Inc.'s operating earnings fell to $12.7 billion in the third quarter, a 5.8% decline from a year earlier. Income from underwriting dropped at the insurance division, with Geico facing an 8.5% increase in losses and a 17% surge in underwriting expenses. Insurance net investment income also declined 14% to $2.7 billion, largely due to lower short-term interest rates.
The firm continued aggressive share buybacks, spending about $9.6 billion in the period — the most so far this year. Despite the earnings decline, its cash pile rose to $377.4 billion at the end of September. Berkshire sold a net $426 million of equity holdings during the quarter.
Chief Executive Officer Greg Abel initiated the buyback program in the first quarter, finding shares trading below intrinsic value. The Omaha, Nebraska-based conglomerate's financial position remains strong despite the quarterly earnings pressure.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing