Warren Buffett Criticizes Trump’s Trade Policies

Warren E. Buffett took a shot at President Trump’s efforts to use tariffs to batter global commerce on Saturday, as his $1.1 trillion conglomerate, Berkshire Hathaway, braced for potential hits from American trade policies.

“Trade should not be a weapon,” Mr. Buffett said at Berkshire’s annual shareholder meeting, a perennially popular event that has been nicknamed the Woodstock of capitalism. “I don’t think it’s right and I don’t think it’s wise.”

The comments by Mr. Buffett, Berkshire’s chief executive, were long awaited by the conglomerate’s shareholders, tens of thousands of whom flocked to the company’s hometown in Omaha to hear directly from the investor — particularly on Mr. Trump’s trade policies. His comments on Saturday ended what had been months of Mr. Buffett maintaining a relatively low public profile.

Mr. Buffett’s comments were especially notable as the 94-year-old billionaire acknowledged that he had previously proposed an idea to help address trade imbalances. But on Saturday, the Berkshire chief defended the broader concept of global trade flows: “We should do what we do best and they should do what they do best,” he said, drawing applause.

Fears about the consequences of the tariffs have roiled markets and affected vast swaths of American companies. That includes Berkshire, which on Saturday reported a sharp drop in first-quarter earnings.

The company reported $9.6 billion in operating income, Mr. Buffett’s preferred measure, down 14 percent from the same time a year ago. Using generally accepted accounting principles, Berkshire reported a nearly 64 percent drop in net income, largely because of paper investment losses.

But while markets have grown much more volatile in response to Mr. Trump’s whipsawing approach to trade, Mr. Buffett professed little worry about the effects of that volatility on Berkshire. “It’s really nothing,” he told shareholders, suggesting that riding out market vicissitudes was part of stock investing.

Despite Mr. Buffett’s criticism of the Trump administration’s trade policy, he again repeated his longtime praise of the United States as a fount of opportunity. “If I were being born today, I would just keep negotiating in the womb until they said you could be in the United States,” he said.

The company reported that a “majority” of its businesses had lower sales and earnings in the first three months of the year, particularly in insurance underwriting income, which was hit by losses tied to the California wildfires.

In a regulatory filing on Saturday, Berkshire warned that Mr. Trump’s trade policies were generating “considerable uncertainty,” which could affect the company’s operating results. “We are currently unable to reliably predict the potential impact on our businesses, whether through changes in product costs, supply chain costs and efficiency, and customer demand for our products and services.”

That said, net earnings at BNSF, a company owned by Berkshire, rose in the quarter, as the railroad said it benefited from higher volumes in the first three months of the year. During the period, many companies raced to stockpile goods before Mr. Trump’s tariffs took effect.

One thing that stood out was Berkshire’s cash hoard, which Mr. Buffett has often called his “elephant gun” and used to make major acquisitions, only continued to grow as the investor found few attractive opportunities of size to spend on. Berkshire’s cash pile in the quarter grew to $347.7 billion, a record.

During his question-and-answer session with shareholders at the annual meeting, Mr. Buffett acknowledged stocking up on cash to prepare for any potential buying opportunity. He revealed that he had weighed a potential $10 billion investment — but later refused to elaborate.

Mr. Buffett has also acknowledged that given Berkshire’s size, it is nearly impossible now for Berkshire to find deals that could meaningfully augment its earnings.

The conglomerate continued to be a net seller of stocks: Berkshire sold $4.68 billion worth of equity in the quarter, compared with $3.18 billion in purchases.

Berkshire is often regarded as a bellwether for corporate America, given its wide array of businesses. Besides BNSF, one of the nation’s biggest railroads, the company owns a powerful insurance operation, an energy utility, many consumer brands — from See’s Candies to Fruit of the Loom — and more.

A number of prominent corporate and business leaders were on hand on Saturday, including the Microsoft co-founder Bill Gates, Tim Cook of Apple (which is one of Berkshire’s biggest stock holdings) and the billionaire financier William A. Ackman. Two first timers, Hillary Rodham Clinton and Priscilla Chan, the wife of Meta’s chief executive Mark Zuckerberg, were also present.

Andrew Ross Sorkin contributed reporting.