Earnings

Berkshire earnings miss; revenue beats expectations

Reuters With CNBC.com
WATCH LIVE
Getty Images

Warren Buffett's Berkshire Hathaway posted a 29 percent jump in third-quarter profit on Friday, but operating results fell short of analyst forecasts amid weakness in its insurance operations.

Results benefited from $1.39 billion of gains from investments and derivatives, more than twice the $521 million a year earlier, but these do not factor into operating results.

Net insurance underwriting premiums, meanwhile, fell 57 percent to $170 million from $392 million a year earlier, while profit rose at the Burlington Northern Santa Fe railroad unit and MidAmerican energy and utilities unit.

Book value, Buffett's preferred measure of the Omaha, Nebraska-based company's worth, rose 11 percent this year to $126,766 per Class A share as of September 30, 2013.

Net income rose to $5.05 billion, or $3,074 per Class A share, from $3.92 billion, or $2,373 per share, a year earlier.

Operating profit rose just 8 percent to $3.66 billion, or $2,228 per Class A share, from $3.4 billion, or $2,057 per share. Revenue was $46.54 billion.

Analyst had expected the company to report operating profit of $2,402 per class A share on revenue of $44.50 billion in revenue.

Buffett, 83, has run Berkshire since 1965, and favors businesses with consistent earnings power.

In June, he spent $12.3 billion to buy part of H.J. Heinz, the maker of ketchup and Ore-Ida potato products.

Berkshire also owns tens of billions of dollars of common stocks such as Coca-Cola, International Business Machines and Wells Fargo.

In Friday trading, Berkshire Class A shares closed up $127.70 at $173,122.50, while its Class B shares rose 19 cents to $115.27. Berkshire released results after U.S. markets closed. Its B shares fell slightly in after-hours trading.