Legendary investor Warren Buffett's company posts $44bn loss

But Berkshire Hathaway, often viewed as a bellwether, also recorded a 39pc rise in operating profit

Warren Buffett, who is chairman and chief executive of Berkshire Hathaway Credit: Andrew Harrer/Bloomberg

Warren Buffett’s company has fallen to a $44bn (£36bn) loss after sharp falls in stock markets took their toll on the legendary investor’s portfolio.

Berkshire Hathaway recorded the $43.8bn loss in the three months to June, down from a profit of $28.1bn last year. 

Its stock portfolio fell in value to $328bn, down from $391bn at the end of March. Three of its major holdings – Apple, Bank of America and American Express – each fell more than 21pc.

However, the company's shares have outperformed the broader US market so far this year, falling 2pc compared with a 13pc drop in the S&P 500.

The business also slowed its investments in new stocks to $6.2bn in the quarter, down from $51.1bn between January and March, when it ploughed money into oil companies. Berkshire Hathaway bought back $1bn worth of its own shares in June.

Despite the headline loss, the conglomerate – which owns an array of companies from insurance to railroads – recorded a 39pc rise in operating profit to $9.3bn. It was helped by insurance units, which were boosted by rising interest rates, and the stronger US dollar increased profits in its European and Japanese debt investments. 

The performance of his company is closely watched because of Mr Buffett’s reputation for investing long term and calling the market correctly.

Berkshire Hathaway owns dozens of businesses, including its eponymous energy operations and manufacturing companies, and consumer companies such as Duracell batteries, Fruit of the Loom underwear and See's Candies. Because of its breadth it is also regarded by many investors as a bellwether, mirroring broader economic trends.

The conglomerate’s results swing wildly because it must report investment gains and losses on its stock holdings even if it buys and sells nothing. In the past Mr Buffett has urged investors to ignore these fluctuations, calling the accounting rule “extremely misleading”.

In 2020, for example, Berkshire lost nearly $50bn in the first quarter as the pandemic took hold, but made $42.5bn for the full year.