This decline was largely driven by an $860 million loss from insurance claims related to the Southern California wildfires, alongside a major drop in the value of its investments.

Berkshire Hathaway reported a significant 14% drop in operating profit for the first quarter of 2025, totaling $9.64 billion, down from $11.22 billion in the same period last year.

Despite these challenges, Berkshire Hathaway's Class A shares have increased by 19% year-to-date, significantly outperforming the S&P 500's decline of 3.3%.

The company also missed earnings expectations, with Class B share earnings reported at $4.47, falling short of forecasts from UBS and FactSet.

The earnings announcement coincided with Berkshire's annual shareholders meeting in Omaha, which attracted thousands of attendees eager to hear Warren Buffett's insights.

Berkshire's cash reserves reached a record high of $347.7 billion, indicating challenges in finding attractive investment opportunities.

Berkshire Hathaway Energy saw a notable 52% increase in earnings to $1.1 billion, while other segments experienced mixed results.

Buffett announced plans to retire as CEO at the end of 2025, with Vice Chairman Greg Abel set to take over leadership.

Buffett emphasized the importance of focusing on operating earnings, which reflect the actual performance of the business, excluding volatile investment swings.

During the quarter, Berkshire was a net seller of stocks, divesting $1.5 billion in equity securities, continuing a trend of selling off assets.

Overall net income plummeted by 64% to $4.6 billion, significantly impacted by unrealized losses on stock holdings, particularly in Apple.

Buffett highlighted rising threats from tariffs and macroeconomic volatility, which are affecting core businesses like Geico and BNSF Railway.