Berkshire Hathaway's cash reserves hit a record $277 billion after Warren Buffett reduced stock holdings.

Last quarter, Warren Buffett sold big chunks in stock holdings including, resulting in a record $276.9 billion increase in his cash pile.

The cash reserves of the Omaha-based conglomerate increased significantly from the previous record of $189 billion, set in the first quarter of 2024, after the Oracle of Omaha sold nearly half of his stake in Tim Cook-led tech giant in the second quarter.

Berkshire has been selling stocks for seven consecutive quarters, with the selling accelerating in the last period. In the second quarter, Buffett sold more than $75 billion in equities, bringing the total of stocks sold in the first half of 2024 to over $90 billion. The selling by Buffett continued in the third quarter, with Berkshire trimming its second-largest stake, Bank of America, for 12 consecutive days, as shown in a filing this week.

In the second quarter, Berkshire's operating earnings increased by 15% to $11.6 billion, thanks to the strong performance of its fully-owned auto insurer, Geico.

At Berkshire's annual meeting in May, Buffett, who will turn 94 at the end of the month, admitted that he is open to investing capital, but the high prices make him hesitant.

"The investment icon stated that they would not spend money unless they believed a business had minimal risk and the potential for significant returns. They emphasized that this was not due to a hunger strike or other extreme measures, but simply because the opportunities were not appealing."

The S&P 500 has experienced a surge in the past two years, reaching record levels as investors predicted that the Federal Reserve would lower inflation with higher interest rates while avoiding an economic recession. The index has increased by 12% in 2024. However, recent concerns about a slowing economy have been raised due to some weak data, such as the disappointing July jobs report. On Friday, the Dow Jones Industrial average lost 600 points. Additionally, investors have recently become concerned about the valuations in the technology sector, which has led the bull market due to optimism surrounding artificial intelligence innovation.

Geico boosts earnings

In the second quarter, Geico generated nearly $1.8 billion in underwriting earnings before taxes, which is more than three times the $514 million earned in the same period last year.

BNSF Railway's profit remained at $1.6 billion, matching the previous year's earnings. Meanwhile, Berkshire Hathaway Energy's utility business experienced a 48% decline in earnings to $326 million compared to the same quarter last year, as the company continues to face potential wildfire liability.

Berkshire's net earnings, including short-term investment gains or losses, decreased to $30.3 billion in the second quarter from $35.9 billion in the same period a year ago. Buffett advises investors to disregard quarterly fluctuations in unrealized gains on investments, which can be "extremely misleading."