During Berkshire Hathaway’s annual shareholder meeting, Warren Buffett, the Chairman and CEO, revealed that the company has sold off all of its shares in Paramount.
Buffett took full ownership of the decision, saying, “I made the call to sell off our Paramount holdings entirely. It was solely my decision, and we incurred significant losses.”
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By the end of 2023, Berkshire Hathaway no longer held any of its initial 63.3 million shares in Paramount after reducing its position by about a third in the previous year’s fourth quarter.
Back in the first quarter of 2022, Berkshire Hathaway acquired a nonvoting stake in Paramount’s class B shares. However, Paramount encountered various challenges, such as a dividend cut, earnings below expectations, and the departure of its CEO. The media company’s stock plummeted by 44% in 2022 and an additional 12% in 2023.
Recently, potential buyers like Sony Pictures and private equity firm Apollo Global Management have shown interest in acquiring Paramount for around $26 billion. Discussions have also been held with David Ellison’s Skydance Media for a possible acquisition.
Warren Buffett disclosed selling off Berkshire Hathaway’s complete stake in Paramount at a loss.
“I was 100% responsible for the Paramount decision,” Buffett stated.
“It was 100% my decision, and we’ve sold it all and we lost quite a bit of money.” pic.twitter.com/nQqhgQ9se1
— unusual_whales (@unusual_whales) May 5, 2024
Paramount has faced challenges with declining revenue from the shift away from traditional pay-TV and ongoing losses in its streaming services. The company’s stock has continued its downward trajectory this year, dropping by nearly 13%.
Buffett’s review of the unsuccessful Paramount investment has led him to consider changing leisure activity preferences. He has emphasized the competitive and saturated streaming industry, which vies for viewer engagement and resources.
Image Source: Kent Sievers / Shutterstock
