Berkshire Hathaway, the multinational conglomerate that Warren Buffett built, suffered a huge earnings disappointment in the first quarter of 2025. The company’s earnings fell almost 64% year over year. The company is up against a 14% comp in operating earnings, $9.64 billion over the same period last year. Foreign exchange losses, as well as geopolitical uncertainties associated with tariffs, played a role among many other factors in this decline.
Share earnings for the company for the quarter was $1.34 billion. This is a massive decline from the $2.60 billion set in the comparable period last year. A major swing factor impacting these results was Berkshire Hathaway’s insurance-underwriting profit, which fell off a cliff, down 48.6%. The conglomerate said it took a huge loss of roughly $713 million because of foreign exchange rates. This was largely due to the dollar depreciating against the Japanese yen, resulting in a 4.6% drop.
Meanwhile, Berkshire Hathaway’s cash war chest hit an all-time peak of more than $347 billion in the opening three months of this year. This sharp jump underscores the company’s aggressive approach even as broader economic concerns mount. Even amid all that turbulence, its Class A shares have seen enormous success. They’ve done it, as of the beginning of 2025, with nearly 19% more value!
The New Jersey-based insurer had $3.4 billion in losses related to hurricanes and floods, among other natural catastrophes. In particular, the Southern California wildfires resulted in a staggering $1.1 billion Q1 loss. These occurrences reveal the extent to which the company is subject to external influences that are able to affect the company’s fiscal health.
For those keeping score, Berkshire Hathaway’s recent investment moves have been decidedly cautious. For the tenth consecutive quarter, it has been a net seller of stocks. This change is a sign of a savvy strategic pivot by management as realized market conditions remain highly dynamic.
In their earnings report, Berkshire Hathaway took time to address the continuing crisis caused by macroeconomic and geopolitical factors. The company stated, “Our periodic operating results may be affected in future periods by impacts of ongoing macroeconomic and geopolitical events, as well as changes in industry or company-specific factors or events.”
Furthermore, they expressed concerns over international trade policies, noting that “the pace of changes in these events, including international trade policies and tariffs, has accelerated in 2025. Considerable uncertainty remains as to the ultimate outcome of these events.”
“We are currently unable to reliably predict the potential impact on our businesses, whether through changes in product costs, supply chain costs and efficiency, and customer demand for our products and services.”
Berkshire’s last quarter came in with $4.47 in operating earnings per share. This is a drop from $5.20 per Class B share in the same period last year. This drop highlights how much the recent global events have hampered the firm’s ability to find its footing in today’s tumultuous economic environment.
Berkshire Hathaway demonstrates unsurpassed staying power with its incredible war chest of cash and equivalents. Yet, outside forces are doing some serious damage to its bottom line. The damage from foreign exchange and natural disasters are emergent impacts that remind us of the suddenness that can happen in global markets.