Warren Buffett’s Berkshire Hathaway has significantly increased its cash reserves to nearly $277 billion while selling about half its stake in Apple, even as the conglomerate reported a record quarterly operating profit.
The results suggest Buffett, 93, is growing cautious about the broader U.S. economy and high stock market valuations. Berkshire’s cash stake grew to $276.9 billion by June 30, up from $189 billion three months earlier, largely due to selling a net $75.5 billion in stocks.
Berkshire sold approximately 390 million Apple shares in the second quarter, in addition to 115 million sold from January to March, as Apple’s stock price rose 23%. Despite these sales, Berkshire still held around 400 million Apple shares worth $84.2 billion by June 30.
“This is an old-fashioned correction,” said Tom Plumb, CEO of Plumb Funds. “We’ve shifted from growth perception to needing government intervention with lower interest rates.”
Second-quarter profit from Berkshire’s various businesses rose 15% to $11.6 billion, driven largely by its insurance businesses, including Geico. However, revenue saw minimal growth, rising just 1% to $93.65 billion.
Buffett has expressed a preference for maintaining a cash reserve and only spending when opportunities with minimal risk and high returns arise.