Berkshire Hathaway reports operating earnings surge, but posts big investment loss amid market rout

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An Andy Warhol-like print of Berkshire Hathaway CEO Warren Buffett hangs outside a clothing stand during the first in-person annual meeting since 2019 of Berkshire Hathaway Inc in Omaha, Nebraska, U.S. April 30, 2022.

Scott Morgan | Reuters

Berkshire Hathaway's operating profits jumped in the second quarter despite fears of slowing growth, Warren Buffett's conglomerate reported Saturday.

The conglomerate's operating earnings — which encompass profits made from the myriad of businesses owned by the conglomerate like insurance, railroads and utilities — totaled $9.283 billion in the second quarter of 2022. It marked a 38.8% increased from its profits during the same quarter a year ago.

Berkshire also said it spent approximately $1 billion in share repurchases during the second quarter, bringing the six-month total to $4.2 billion. However, that's a slower repurchase pace than the one seen in the first quarter, when the company bought back $3.2 billion of if its own stock.

Warren Buffett's conglomerate was not immune to the market turmoil in the second quarter. The company posted a $53 billion loss on its investments during the quarter. The legendary investor again asked investors to not focus on the quarterly fluctuations in its equity investments.

"The amount of investment gains/losses in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules," Berkshire said in a statement.

The conglomerate's Class A stock fell more than 22% in the second quarter, down nearly 24% from its all-time high reached on March 28. The pullback coincided with a big sell-off in the broader market, which tumbled into a bear market after aggressive rate hikes from the Federal Reserve sparked fears of a recession.

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