Berkshire Hathaway (BRK.A) First Quarter 2023 Earnings

Warren Buffett at the annual meeting of Berkshire Hathaway in Los Angeles, California. May 1, 2021.

Gerard Miller | CNBC

Earnings for Warren Buffett’s Berkshire Hathaway jumped in the first quarter, thanks in part to a rebound in the group’s insurance business.

Total operating profit, which includes earnings from businesses wholly owned by the group, was $8.065 billion in the first quarter. This represents an increase of 12.6% over $7.16 billion in the previous year.

Insurance underwriting profits were $911 million, up sharply from $167 million a year earlier. Insurance investment income also jumped 68% to $1.969 billion from $1.170 billion.

Geico had a big turnaround in the quarter, returning a sizable underwriting profit of $703 million. A car insurance company suffered $1.9 billion Pre-tax underwriting loss last year as it lost market share to rival Progressive. Ajit Jain, vice president of insurance operations at Berkshire, previously said that the biggest reason for Geico’s underperformance is telecommuting.

The company’s rail business, BNSF, along with its energy subsidiary saw earnings decline year-over-year. Operations categorized as “Other Controlled Businesses” and “Uncontrolled Businesses” saw slight increases over the same period last year.

Berkshire’s cash stock swelled to $130.616 billion from $128 billion in the fourth quarter of 2022. Berkshire also bought back $4.4 billion worth of stock — the most since the first quarter of 2021 — from $2.8 billion at the end of last year.

Berkshire’s net profit, which includes short-term investment gains, rose to $35.5 billion in the quarter from $5.6 billion in the year-ago period, reflecting a first-quarter return in Warren Buffett’s investments in stocks, such as Apple. Although Buffett warns investors not to pay attention to quarterly fluctuations in unrealized gains on investments.

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The company’s latest quarterly results come before the group’s annual meeting of shareholders, an event known as “Woodstock for Capitalists.”

Berkshire Class A shares are up 4.9% this year through Friday’s close, trailing the S&P 500’s 7.7% advance. However, the stock is less than 3% below its all-time high.

— CNBC’s Yoon Lee contributed to the report.

Tune in to CNBC’s live stream of Berkshire Hathaway’s 2023 Annual Meeting starting live at 9:45 a.m. ET on Saturday. here.

Follow the highlights and live updates of the meeting here.

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