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Berkshire’s first-quarter net loss totaled $ 49.75 billion, or $ 30,653 per Class A share, reflecting $ 54.52 billion of investment losses, primarily common stock. A year earlier, net earnings totaled $ 21.66 billion, or $ 13,209 per share.
Quarterly operating profit, which Buffett considers a better performance measure, increased 6% to $ 5.87 billion, or about $ 3,624 per Class A share, $ 5.56 billion, or about $ 3,388 per share.
An accounting rule requires Berkshire to report profit and loss on unrealized stock with profit. This causes major changes in Berkshire’s net results that Buffett considers to be pointless.
However, Berkshire has been stock-laden in part due to Buffett’s inability to find large companies to buy directly from, a drought that has lasted more than four years and left Berkshire with around $ 137.3 billion in cash.
The Standard & Poor’s 500 fell 20% in the first quarter, but there were steeper declines at several large Berkshire properties, including American Express, Bank of America, Wells Fargo, and four airlines: American, Delta, Southwest, and United.
Berkshire’s operating businesses, like much of corporate America, were not unscathed by COVID-19, which hurt volumes on the BNSF rail and forced retail businesses like See’s Candies to temporarily close stores.
The pandemic has affected most Berkshire businesses, with effects ranging from “relatively minor to severe,” and revenues from businesses deemed “essential” have slowed “considerably” in April, the company said.
Vice President Charlie Munger told the Wall Street Journal last month that some small Berkshire businesses could close entirely.
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