Berkshire Hathaway Lost $50 Billion Last Quarter As Warren Buffett’s Investments Took A Hit From Coronavirus

TOPLINE

Billionaire Warren Buffett’s famed investing conglomerate, Berkshire Hathaway, reported a massive net loss of nearly $50 billion in the first quarter, as the coronavirus-driven market sell-off took a significant toll on the company’s stock holdings.

Operating profits rose, even as the company posted a record loss last quarter.

Nati Harnik/ASSOCIATED PRESS

KEY FACTS

Berkshire posted a record net loss of $49.75 billion in the first quarter—down from $21.7 billion in profit last year.

That amounts to a loss of $30,653 per share, compared to profits of $13,209 per share in the first quarter of 2019.

Even as the coronavirus hurt the company’s business, Berkshire’s operating profit rose 6% to $5.87 billion, up from $5.56 billion a year ago.

Berkshire’s quarterly filing makes 31 references to coronavirus, showing the pandemic’s substantial impact on the company so far in 2020.

The first quarter saw many of Buffett’s largest stock holdings—including big banks and airlines, plummet even further than the benchmark S&P 500, which fell 20% during that period.

Buffett’s cash pile is up from $125 billion to $137.3 billion, as the Oracle of Omaha continues to look for an elephant-sized acquisition.

Key background

Buffett emerged as a key player who helped restore confidence in the markets during the 2008 financial crisis, but he’s remained relatively quiet during the 2020 coronavirus downturn. Charlie Munger, vice chairman at Berkshire Hathaway

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, told the Wall Street Journal recently that the Oracle of Omaha is being “fairly conservative” with his investments in the current market. He also admitted that a few of Berkshire’s smaller businesses might altogether. Companies are reportedly not calling Berkshire for capital like they were in 2008: “The phone is not ringing off the hook,” Munger confirmed, adding that airlines are “all negotiating with the government, but they’re not calling Warren.”

Crucial statistic

Berkshire Hathaway’s stock is down 20% so far this year, compared to a 13% decline for the S&P 500.

Tangent

Warren Buffett is the world’s fourth-richest person, with a net worth of $72 billion, according to Forbes’ estimates.

What to watch for

Berkshire’s first-ever online annual shareholders meeting will take place later today, at 4:45 p.m. ET.