Warren Buffett Praises Apple After Berkshire Cuts Stake
Warren Buffett is still a big fan of Apple.
The legendary investor praised the iPhone maker on Saturday from the stage of his annual meeting in Omaha, Neb., even after revealing that Berkshire Hathaway had slashed its stake in the first quarter.
Buffett told an arena of Berkshire shareholders that Apple is “an even better business” than American Express and Coca-Cola, two other big positions in his company’s massive stock portfolio.
A regulatory filing released Saturday morning showed that Berkshire sold about 13% of its mammoth stake in Apple in the first months of 2024, leaving it with $135.4 billion of the iPhone maker’s shares at the end of March.
Apple shares dropped 11% in the first quarter as iPhone sales slumped in China.
“Unless something really extraordinary happens we will own Apple, American Express and Coca-Cola when Greg takes over this place,” Buffett said.
Greg Abel, Buffett’s designated successor as chief executive of Berkshire, sat beside him on the stage, while Tim Cook, Apple’s CEO, watched from in the crowd.
The Berkshire chairman and chief executive said it is “extremely likely” that Apple will remain the company’s largest stock position at the end of the year.
Investors from around the world have flocked to Omaha to hear Buffett, 93 years old, hold forth on investing, business and life. The meeting is significant for many as the first without Buffett’s late partner Charlie Munger, who died in November at age 99.
Buffett himself fell back into the rhythm of past Berkshire meetings when he accidentally said “Charlie” instead of “Greg” as he turned to the man beside him. The crowd broke into applause.
Asked about his most trusted advisers today, Buffett said that he trusts his children and wife totally, “but that doesn’t mean I ask them what stocks to buy.”
“In terms of managing money there wasn’t anybody better in the world to talk to for many, many decades than Charlie,” Buffett said.
The short movie that preceded the Q&A session was a tribute to Munger. It featured clips of his appearances over the years on TV shows like “Breaking Bad,” “Desperate Housewives” and “The Office,” as well as clips of Munger’s memorable lines at past annual meetings. It concluded with a montage of famous real-life and fictitious duos that ended with Buffett and Munger. Munger then received a standing ovation from the crowd.
At events leading up to the annual meeting, visitors spoke frequently of Munger. His death prompted shareholder Melissa Vainik and her mother, Rosalyn Slater, to travel again to Omaha from West Bloomfield, Mich. Slater recalled appreciating Munger’s “biting humor.”
“Because of his passing, we felt the need to come,” Vainik said. “What if something happens to Warren Buffett and then it’s the end of an era?”
Return visitors to Berkshire’s annual meeting know to expect crowds. Early birds aiming for a good seat had the chance to enter the convention center’s parking lots at 3:30 a.m. Saturday.
Nearby hotels filled up early. On the Friday and Saturday nights of last year’s annual meeting, 93% of hotel rooms in the county were filled, according to Jasmyn Goodwin, vice president of marketing and communications for Visit Omaha.
At an exhibit hall, shareholders walked by a towering inflatable Geico gecko to snap up Squishmallows plush toys in the form of Buffett and Munger from subsidiary Jazwares. They queued to tour a mock-up of a NetJets private plane while eating frozen treats from Dairy Queen. A house from Clayton Homes, a pontoon boat from Forest River and Buffett and Munger bobblehead dolls from Oriental Trading were also on display.
Munger’s book “Poor Charlie’s Almanack” was the only one for sale at this year’s event, Buffett said.
LaWanda Cartwright, a semiretired kindergarten teacher, traveled to Omaha from Auburn, Wash., with her son and teenage granddaughter. Years ago, Cartwright decided to give her grandchildren a share of Berkshire instead of a toy for gifts. “You own a little bit of Dairy Queen,” she would tell them when they visited the chain.
“So it made them aware of investment possibilities,” Cartwright said.
Berkshire reported net income of $12.7 billion, or $8,825 a Class A share equivalent, for the first quarter. That was down from $35.5 billion, or $24,377 a Class A share equivalent, a year earlier.
Operating earnings, which exclude some investment results, rose to $11.2 billion from $8.1 billion last year.
Buffett encourages investors to focus on operating earnings to assess the company’s performance. Berkshire is required by accounting rules to include unrealized gains and losses from its massive investment portfolio when it reports net income. That means the movements of the stock market can have a big influence on the company’s quarterly results.
Berkshire’s cash pile rose to a record $189 billion, including cash equivalents, from $167.6 billion at the end of last year. Followers of the company have been looking for clues about what Buffett might do with the cash hoard, from acquiring a new business to buying stocks to stepping up share repurchases. Berkshire doesn’t pay a dividend.Berkshire’s Class B shares have climbed 12% this year, compared with a 7.5% rise in the S&P 500. That has brought the company’s market value to about $865 billion, making it the seventh-largest U.S. company by market value. The bigger ones are all tech titans.
Write to Karen Langley at [email protected]