OMAHA, Neb. (AP) — Warren Buffett is now sitting on more than $325 billion cash after continuing to unload billions of dollars worth of Apple and Bank of America shares this year and continuing to collect a steady stream of profits from all of Berkshire Hathaway's assorted businesses without finding any major acquisitions.
Berkshire said it sold off about 100 million more Apple shares in the third quarter after halving its massive investment in the iPhone maker last quarter. The remaining stake of roughly 300 million shares was valued at $69.9 billion at the end of September remains Berkshire's biggest single investment, but it has been cut drastically since the end of last year when it was worth $174.3 billion.
Investors will also be disappointed to learn that Berkshire didn't repurchase any of its own shares in the quarter.
CFRA Research analyst Cathy Seifert said shareholders will wonder why Buffett is continuing to accumulate so much cash. “Are they more pessimistic about the future economic and market picture than perhaps others are?” she said.
Buffett said at the annual meeting in May that part of why he started selling some of his Apple shares is that he expects tax rates to go higher in the future. But Edward Jones analyst Jim Shanahan said he wonders if part of the reason Buffett started selling Apple is tied to last year's death of Vice Chairman Charlie Munger because the sales started shortly after Munger's death. Shanahan said Buffett has never been as comfortable with technology businesses as his longtime partner was.
“If Charlie Munger were still alive, perhaps he wouldn’t have sold down the position quite as aggressively — maybe at all,” Shanahan said.
Berkshire said Saturday that investment gains again drove its third quarter profits skyward to $26.25 billion, or $18,272 per Class A share. A year ago, unrealized paper investment losses dragged the Omaha, Nebraska-based conglomerate's earnings down to a loss of $12.77 billion, or $8,824 per Class A share.
Buffett has long recommended that investors pay more attention to Berkshire’s operating earnings if they want to get a good sense of how the businesses it owns are doing because those numbers exclude investments. Berkshire’s bottom-line profit figures can vary widely from quarter to quarter along with the value of its investments regardless of whether the company bought or sold anything.
By that measure, Berkshire said its operating earnings were only down about 6% at $10.09 billion, or $7,023.01 per Class A share. That compares to last year's $10.8 billion, or $7,437.15 per Class A share.
The four analysts surveyed by FactSet Research predicted that Berkshire would report operating earnings of $7,335.11 per Class A share.
Berkshire's revenue didn't change much at $92.995 billion. A year ago, it reported $93.21 billion revenue. That number was ahead of the $92.231 billion revenue that three analysts surveyed by FactSet predicted.
Berkshire owns an assortment of insurance businesses, including Geico, along with BNSF railroad, several major utilities and a varied collection of retail and manufacturing businesses, including brands like Dairy Queen and See’s Candy.
One of Berkshire's insurers, Guard, reported some additional losses on previous years after managers reassessed its policies.
Berkshire did resolve one mystery from the quarter by spelling out how much it paid to acquire the rest of the shares in its utility business from the estate of former Berkshire board member Walter Scott.
Berkshire said it paid $2.4 billion cash, issued $600 million in debt and gave the Scott family Class B Berkshire shares worth a little over $1 billion. So the total compensation was about $4 billion. That means the Scott family didn’t get nearly as good of a price for their 8% stake in the utilities as when Berkshire Vice Chairman Greg Abel sold his 1% stake in the utility business two years ago for $870 million.
Abel is slated to succeed the 94-year-old Buffett as CEO in the event of his death.
FILE - Shareholder Tina Schmidt of Cozad, Neb., wears a shirt with Warren Buffett's portrait in the style of an Andy Warhol painting at the Berkshire Hathaway annual meeting on May 4, 2024, in Omaha, Neb. (AP Photo/Rebecca S. Gratz, File)
BRUSSELS (AP) — NATO Secretary-General Mark Rutte on Tuesday sidestepped questions about Ukraine’s possible membership in the military alliance, saying that the priority now must be to strengthen the country’s hand in any future peace talks with Russia by sending it more weapons.
Rutte’s remarks, ahead of a meeting of NATO foreign ministers, came days after Ukrainian President Volodymyr Zelenskyy said that extending alliance membership to territory now under Kyiv’s control could end “the hot stage" of the almost 3-year war in Ukraine, where Russian forces are pressing deeper into their western neighbor.
“The front is not moving eastwards. It is slowly moving westwards,” Rutte said. “So we have to make sure that Ukraine gets into a position of strength, and then it should be for the Ukrainian government to decide on the next steps, in terms of opening peace talks and how to conduct them.”
At their summit in Washington in July, leaders of the 32 NATO member countries insisted that Ukraine is on an “irreversible” path to membership. But some, led by the United States, have balked at moving forward while the war rages and before the country’s borders are clearly demarcated. All 32 countries must agree unanimously for Ukraine to join.
NATO was founded on the principle that an attack on any ally should be considered an attack on them all, and the alliance has consistently tried to avoid being dragged into a wider war with nuclear-armed Russia.
Zelenskyy argued that once open conflict ends, any proposal to join NATO could be extended to all parts of the country that fall under internationally recognized borders.
Pressed on this by reporters, Rutte said: “I would argue, let’s not have all these discussions step by step on what a peace process might look like.”
The first step, he said, must be to “make sure that Ukraine has what it needs to get to a position of strength when those peace talks start.”
Ukrainian officials made it clear Tuesday they won’t countenance any half measures or stopgap solutions on NATO membership.
The Ukrainian Foreign Ministry issued a strongly worded statement saying Ukraine “will not settle for any alternatives, surrogates or substitutes for Ukraine’s full membership in NATO,” citing its “bitter experience of the Budapest Memorandum.”
Under the international agreement signed in the Hungarian capital 30 years ago, Ukraine agreed to give up its Soviet-era atomic weapons, which amounted to the world’s third-largest nuclear arsenal, in return for security guarantees from Russia, the United States and the United Kingdom.
The Foreign Ministry statement called the Budapest agreement a “monument to short-sightedness in making strategic security decisions.”
“We are convinced that the only real guarantee of security for Ukraine, as well as a deterrent for further Russian aggression against Ukraine and other states, is Ukraine’s full membership in NATO,” it said.
At NATO headquarters in Brussels, Ukrainian Foreign Minister Andrii Sybiha showed reporters a copy of the Budapest document.
“This document, this paper, failed to secure Ukrainian security and transatlantic security. So we must avoid to repeat such mistakes,” he said in English.
Reflecting on his recent meeting with U.S. President-elect Donald Trump, Rutte said he had underlined that China, North Korea and Iran were weighing in on Russia's side, putting the United States and the Asia-Pacific region at risk.
“Whenever we get to a deal on Ukraine it has to be a good deal, because what we can never have is high-fiving Kim Jong Un and Xi Jinping and whoever else," Rutte said, saying this would only encourage the leaders of North Korea and China to endorse the use of force elsewhere.
British Prime Minister Keir Starmer said Ukraine’s allies must “do what it takes to support their self-defense for as long as it takes,” but acknowledged that the war will end in negotiations and potential compromise.
Starmer said in a speech late Monday that allies must “put Ukraine in the strongest possible position for negotiations so they can secure a just and lasting peace on their terms that guarantees their security, independence — and right to choose their own future.”
Novikov reported from Kyiv, Ukraine. Jill Lawless in London contributed.
Follow AP’s coverage of the war in Ukraine at https://apnews.com/hub/russia-ukraine
United States Secretary of State Antony Blinken, left, and NATO Secretary General Mark Rutte deliver a statement ahead of a meeting of NATO foreign ministers at NATO headquarters in Brussels,Tuesday, Dec. 3, 2024. (AP Photo/Virginia Mayo)
NATO Secretary General Mark Rutte, right, shakes hands with United States Secretary of State Antony Blinken during a meeting of NATO foreign ministers at NATO headquarters in Brussels,Tuesday, Dec. 3, 2024. (AP Photo/Virginia Mayo)
NATO Secretary General Mark Rutte speaks during a media conference prior to a meeting of NATO foreign ministers at NATO headquarters in Brussels,Tuesday, Dec. 3, 2024. (AP Photo/Virginia Mayo)
NATO Secretary General Mark Rutte speaks during a media conference prior to a meeting of NATO foreign ministers at NATO headquarters in Brussels,Tuesday, Dec. 3, 2024. (AP Photo/Virginia Mayo)
NATO Secretary General Mark Rutte speaks during a media conference prior to a meeting of NATO foreign ministers at NATO headquarters in Brussels,Tuesday, Dec. 3, 2024. (AP Photo/Virginia Mayo)
NATO Secretary General Mark Rutte takes questions during a media conference prior to a meeting of NATO foreign ministers at NATO headquarters in Brussels,Tuesday, Dec. 3, 2024. (AP Photo/Virginia Mayo)
NATO Secretary General Mark Rutte speaks during a media conference prior to a meeting of NATO foreign ministers at NATO headquarters in Brussels,Tuesday, Dec. 3, 2024. (AP Photo/Virginia Mayo)
