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Warren Buffett's Berkshire Hathaway has dramatically reshaped its investment portfolio in Q3 2024, accumulating a record $325.2 billion in cash while significantly reducing positions in key holdings. The conglomerate's aggressive selling strategy, particularly of Apple shares, signals a notably cautious stance in current market conditions.
In a decisive move, Berkshire sold approximately 100 million Apple shares during the summer quarter, reducing its holding to around 300 million shares valued at $69.9 billion. This follows a broader pattern of divestment in 2024, with Berkshire having sold over 600 million Apple shares despite it remaining the firm's largest stock position. The company also divested several billion dollars in Bank of America shares, contributing to total stock sales of $36.1 billion in the quarter.
Operating performance showed mixed results, with quarterly operating profit declining 6% to $10.09 billion ($7,019 per Class A share), down from $10.76 billion year-over-year. Insurance operations faced significant headwinds, with underwriting profit falling 69% due to Hurricane Helene losses of $565 million and increased claims. However, Geico showed remarkable improvement, nearly doubling its underwriting profit.
"Part of why I started selling some Apple shares is that I expect tax rates to go higher in the future," Buffett explained at the May annual meeting, offering insight into the strategic thinking behind the portfolio restructuring. The conglomerate's net buying has remained muted, with just $1.5 billion in stock purchases during Q3, marking the eighth consecutive quarter as a net seller.
The Berkshire projects substantial losses of $1.3-1.5 billion pre-tax in Q4 from Hurricane Milton's impact on Florida. Despite these challenges, the company's net income reached $26.25 billion ($18,272 per Class A share), a significant turnaround from the previous year's $12.77 billion loss.
The absence of share repurchases and major acquisitions, combined with the record cash position, suggests a strategic positioning for potential market opportunities while maintaining a conservative approach in the current economic environment. At 94, Buffett continues to lead Berkshire's strategic direction, with Vice Chairman Greg Abel, 62, positioned as his eventual successor.
