Finance

Greg Abel, the vice chairman for non-insurance operations at Berkshire Hathaway, joined Warren Buffett in Japan last month to visit the nation’s top trading houses.
Buffett has indicated that Abel has taken on many responsibilities at the massive conglomerate. “He does all the work, and I take the bows – it’s exactly what I wanted,” the veteran investor said in a CNBC interview in April.
Abel has increased his stake in Berkshire Hathaway, which has given shareholders hope that the culture at the company will continue.

Greg Abel at Berkshire Hathaway’s annual meeting in Los Angeles California. May 1, 2021.
Gerard Miller | CNBC

To say that Warren Buffett’s successor Greg Abel has big shoes to fill would be an understatement.
The vice chairman for non-insurance operations at Berkshire Hathaway recently joined Buffett in Japan to visit the country’s top trading houses. In a three-hour interview with CNBC, the 92-year-old “Oracle of Omaha” sang Abel’s praises, saying he’s taken on most of the responsibilities.

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“He does all the work, and I take the bows – it’s exactly what I wanted,” Buffett said in a CNBC interview in Japan on April 12. “He knows more about the individuals, the business, he’s seen them all…. they haven’t seen me at the BNSF Railroad for 10, 12 years or something like that.”
Abel became known as Buffett’s heir apparent in 2021 after Charlie Munger inadvertently made the revelation at the shareholder meeting. Abel has been overseeing a major portion of Berkshire’s sprawling empire, including energy, railroad and retail.
Buffett revealed that contrary to what many might’ve thought, there wasn’t any competition between Abel and Ajit Jain, Berkshire’s vice chairman of insurance operations, for the top job. The two of them had been viewed as top contenders since they were promoted to vice chairmen in 2018.
“Ajit never wanted to run Berkshire,” Buffett said.
Skin in the game
Abel recently loaded up on Berkshire Hathaway shares with his personal assets. The 60-year-old vice chairman added to his stake in Berkshire in March, bringing the total value of his holdings in the company to about $105 million.

The move increased his skin in the game and raised hopes among shareholders that the culture will continue at Berkshire.
“What really gives you some optimism for the future of Berkshire post Buffett Munger is him buying in a significant stake in the company,” said Bill Stone, chief investment officer at Glenview Trust and a Berkshire shareholder. “One of the beauties of Berkshire is that you always knew it was like an owner manager.”
Energy question
Abel is also known for his strong expertise in the energy industry. Berkshire acquired MidAmerican Energy in 1999, and Abel became CEO of MidAmerican Energy in 2008, six years before it was renamed Berkshire Hathaway Energy in 2014.
In 2022, Berkshire proposed spending nearly $4 billion to help generate more wind and solar power to Iowa. At the same time, the conglomerate has been dramatically increasing its exposure to two traditional energy companies — Occidental Petroleum and Chevron. Some shareholders want Abel to address these moves in the industry.
“That’s the question for him. Help us understand why you are simultaneously being aggressive with your solar and wind investments in Iowa, and buying oil and gas stocks at the same time,” said Bill Smead, Smead Capital Management chief investment officer and a Berkshire shareholder.
‘Time will tell’
While shareholders have grown more confident in Abel’s capabilities, some key questions about the eventual succession linger.
“When opportunities arise, who has the ultimate decision? Is it the board? How does dispute resolution work if there is a dispute,” said a Berkshire shareholder, who spoke on the condition of anonymity.
Abel’s track record of more than two decades at the conglomerate convinced Buffett that the two are on the same page in terms of deal-making and capital allocation.
 “It’s already improved dramatically, the management of Berkshire. And we think alike on acquisitions. We think alike on capital allocation. I mean, he’s a big improvement on me, but don’t tell anybody,” Buffett said in Japan.
Apart from Berkshire’s massive operations, the conglomerate has a gigantic equity portfolio worth north of $300 billion managed by Buffett. His two investing lieutenants, Todd Combs and Ted Weschler, oversee about $15 billion each.
“Only time will tell. There are companies that have done exceptionally well after their founders passed, like Apple, but others have struggled, like GE,” said another long-time shareholder who asked not to be named. More

Customers shop at an Apple store on November 28, 2022 in Chicago, Illinois.
Scott Olson | Getty Images

Check out the companies making headlines in midday trading.
Carvana – The used car retailer saw shares surge 28% after the company said it expects to achieve positive adjusted profit during the second quarter of this year, which would be earlier than it previously stated. Carvana posted a smaller-than-expected loss Thursday, according to Refinitiv. The company has been working to reduce costs, narrow losses and increase profits per vehicle after its stock fell about 98% in 2022.

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Apple – The tech giant advanced more than 4%. On Thursday, Apple reported better-than-expected earnings and revenue for its fiscal second quarter, according to Refinitiv, driven by stronger-than-anticipated iPhones sales. The company also flagged strength in emerging markets and improved supply.
Lyft – Stock in the rideshare giant fell 21% on Friday, after reporting quarterly results a day earlier. Weak forward guidance drove the stock lower and stoked investor worry. The company beat expectations on revenue.
Coinbase – Shares of the cryptocurrency platform rose 17% after Wedbush reiterated an outperform rating on the stock earlier on Friday. The company reported beats on quarterly results a day earlier, with a smaller-than-expected loss of 34 cents per share.
Nvidia – Shares of Nvidia jumped 3%. The action came after a Microsoft spokesperson denied in a Bloomberg report that AMD is part of its Athena artificial intelligence chip project.
VF Corp – The North Face and Vans parent rose 4%. Wells Fargo upgraded the stock to equal weight from underweight, saying green shoots for Vans were becoming harder to ignore.

Tesla, Lucid – Both electric vehicle makers were higher in midday trading, with Tesla gaining 4% and Lucid adding 5%. Tesla, meanwhile, hiked prices for two high-end vehicles in China earlier on Friday. Lucid is set to report quarterly results on May 8, and analysts polled by FactSet forecast a loss of 39 cents per share.
Affirm – The installment payments company added 16% Friday. Affirm will report quarterly earnings on May 9, and analysts expect the company will post a loss of 85 cents per share, according to FactSet.
PacWest, Western Alliance, Zions Bancorp — Regional bank stocks rebounded on Friday, clawing back some of the group’s losses from earlier in the week. Shares of PacWest jumped more than 70%. Western Alliance gained 45% after being upgraded by JPMorgan. Zions Bancorp and Comerica were also upgraded by JPMorgan, climbing 21% and 17%, respectively.
— CNBC’s Jesse Pound, Alex Harring, Tanaya Macheel and Michelle Fox Theobald contributed reporting More

With interest rates rising and regional banks suffering, a number of new entrants have entered the market for high-yield savings accounts.
Apple jumped into the market last month, with a savings account that yields more than 4%, while fintechs like Robinhood and Upgrade offer products with even higher rates.
“It’s really a trade-off for consumers, between safety or the appearance of safety, and yield,” Upgrade CEO Renaud Laplanche told CNBC.

Upgrade CEO Renaud Laplanche speaks at a conference in Brooklyn, New York, in 2018.
Alex Flynn | Bloomberg via Getty Images

The technology industry is known for innovation and spawning the next big thing. But at a time of economic uncertainty and rising interest rates, a growing piece of the tech sector is going after one of the most noninnovative products on the planet: yield.
With U.S. Treasury yields climbing late last year to their highest in more than a decade, consumers and investors can finally generate returns just by parking their money in savings accounts.

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Banks are responding by offering higher-yielding offerings. American Express, for example, offers consumers a 3.75% annual percentage yield (APY), and First Citizens’ CIT Bank has a 4.75% APY for customers with at least $5,000 in deposits. Ally Bank, which is online only, is promoting a 4.8% certificate of deposit.
However, some of the highest rates available to savers aren’t coming from traditional financial firms or credit unions, but rather from companies in and around Silicon Valley.
Apple is the most notable new entrant. Last month, the iPhone maker launched its Apple Card savings account with a generous 4.15% APY in partnership with Wall Street giant Goldman Sachs.
Then there’s the whole fintech market, consisting of companies offering consumer financial services with a focus on digital products and a friendly mobile experience instead of physical branches with costly bank tellers and loan officers.
Stock trading app Robinhood has a feature called Robinhood Gold, which offers 4.65% APY. Interest is earned on uninvested cash swept from the client’s brokerage account to partner banks. It’s part of a $5-a-month subscription that also includes lower borrowing costs for margin investing and research for stock investing.

The company lifted its yield from 4.4% on Wednesday after the Federal Reserve approved its 10th rate increase in a little more than a year, raising its benchmark borrowing rate by 0.25 percentage point to a target range of 5%-5.25%.

Fed Chair Jerome Powell speaks during a conference at the Federal Reserve Bank of Chicago on June 4, 2019.
Scott Olson | Getty Images

“At Robinhood, we’re always looking for ways to help our customers make their money work for them,” the company said in a press release announcing its hike.
LendingClub, an online lender, is promoting an account with a 4.25% yield. The company told CNBC that deposit growth was up 13% for the first quarter of 2023 compared with the prior quarter, “as depositors looked to diversify their money out of traditional banks and earn increased savings.” Year over year, savings deposits have increased by 81%.
And Upgrade, which is led by LendingClub founder Renaud Laplanche, offers 4.56% for customers with a minimum balance of $1,000.
“It’s really a trade-off for consumers, between safety or the appearance of safety, and yield,” Laplanche told CNBC. Upgrade, which is based in San Francisco, and most other fintech players keep customer deposits with institutions backed by the Federal Deposit Insurance Corp., so consumer funds are safe up to the $250,000 threshold.
SoFi is the rare example of a fintech with a banking charter, which it acquired last year. It offers a high-yield savings product with a 4.2% APY.
The story isn’t just about rising interest rates.
Across the emerging fintech spectrum, companies like Upgrade are, intentionally or not, taking advantage of a moment of upheaval in traditional finance. On Monday, First Republic became the third American bank to fail since March, following the collapses of Silicon Valley Bank and Signature Bank. All three saw depositors rush for the exits as concerns about a liquidity crunch led to a cycle of doom.
Shares of PacWest and other regional banks have plummeted this week, even after First Republic’s orchestrated sale to JPMorgan Chase was meant to signal stability in the system.
After the collapse of SVB, Laplanche said Upgrade’s banking partners came to the company and asked it to step up the inflow of funds, an apparent effort to stanch the withdrawals at smaller banks. Upgrade farms out the money it attracts to a network of 200 small- and medium-sized banks and credit unions that pay the company for the deposits.

Used to be dead money

For well over a decade, before the recent jump in rates, savings accounts were dead money. Borrowing rates were so low that banks couldn’t profitably offer yield on deposits. Also, stocks were on such a tear that investors were doing just fine in equities and index funds. A subset of those with a stomach for risk went big in crypto.
As the price of bitcoin soared, a number of crypto exchanges and lenders began mimicking the banks’ savings model, offering very high yield (up to 20% annually) for investors to store their crypto. Those exchanges are now bankrupt following the crypto industry’s meltdown last year, and many thousands of clients lost their funds.
There is some potential instability for fintechs, even those outside of the crypto space. Many of them, including Upgrade and Affirm, partner with Cross River Bank, which serves as the regulated bank for companies that don’t have charters, allowing them to offer lending and credit products.
Last week, Cross River was hit with a consent order from the FDIC for what the agency called “unsafe or unsound banking practices.”
Cross River said in a statement that the order was focused on fair lending issues that occurred in 2021, and that it “places no limitations on our extensive existing fintech partnerships or the credit products we presently offer in partnership with them.”
While fintechs broadly are under far less regulatory pressure than crypto companies, the FDIC’s action suggests that regulators are beginning to pay closer attention to the kinds of products that high-yield accounts are designed to complement.
Still, the emerging group of high-yield savings products are much more mainstream than what the crypto platforms were promoting. That’s largely because the deposits come with government-backed insurance protections, which have a long history of safety.
They’re also not designed to be big profit centers. Rather, by offering high yields for consumers who have long housed their money in stagnant accounts, tech and fintech companies are opening the door to potentially new customers.
Apple has a whole suite of financial products, including a credit card and payments app, that pair smoothly with the savings account, which is only available to the 6 million-plus Apple Card holders. Those customers reportedly put in nearly $1 billion in deposits in the first four days the service was on the market.
Apple didn’t respond to a request for comment. CEO Tim Cook said on the company’s earnings call Thursday that, “we are very pleased with the initial response on it. It’s been incredible.”

Apple savings account

Robinhood, meanwhile, wants more people to use its trading platform, and companies like LendingClub and SoFi are building relationships with potential borrowers.
Laplanche said high-yield savings accounts, while compelling for the consumer, aren’t core to most fintech businesses but serve as an onboarding tool to more lucrative products, like consumer lending or conventional credit cards.
“We started with credit,” Laplanche said. “We think that’s a better strategy.”
SoFi launched its high-yield savings account in February of last year. In its annual SEC filing, the company said that offering checking and high-yield savings accounts provided “more daily interactions with our members.”
Affirm, best known as a buy now, pay later firm, has offered a savings account since 2020 as part of a “full suite” of financial products. Its yield is currently 3.75%.
“Consumers can use our app to manage payments, open a high-yield savings account, and access a personalized marketplace,” the company said in a 2022 SEC filing. A spokesperson for Affirm told CNBC that the saving account is “one of the many solutions in our suite of products that empower consumers with a smarter way to manage their finances.”
Set against the backdrop of a regional banking crisis, savings products from anywhere but a national bank might seem unappealing. But chasing yield does come with at least a little bit of risk.
“Citi or Chase, feels like it’s safe,” to the consumer, Laplanche said. “Apple and Goldman aren’t inherently risky, but it’s not the same as Chase.”
— CNBC’s Darla Mercado contributed to this report.
WATCH: Consumers are spending more for the same items than they were a year ago More

Pedestrians walk passed signage at Cigna headquarters in Bloomfield, Connecticut.
Michael Nagle | Bloomberg | Getty Images

Check out the companies making the biggest moves premarket:
Cigna — Cigna gained 3% in premarket trading after beating top- and bottom-line estimates for its latest quarter and raising its full-year forecast. Cigna’s results got a boost from lower medical costs and strong growth at its health insurance unit.

Warner Bros. Discovery — The media company fell 2.3% in the premarket after it reported a quarterly loss, and its adjusted earnings fell slightly short of expectations. However, its streaming business did turn around previous losses and reported a quarterly profit.
DraftKings — The sports betting company’s stock surged 11.6% in the premarket after DraftKings reported significantly higher than expected revenue for its latest quarter and increasing its full-year outlook.
Apple — Apple rose 2.7% in premarket trading after beating quarterly earnings and revenue estimates, with particularly upbeat results for its flagship iPhone. Apple did, however, post its second consecutive quarter of declining revenue for only the 3rd time in the past decade.
Bumble — Bumble posted higher than expected quarterly sales, as user demand for its dating app remained strong. The stock jumped 9.1% in premarket action.
Booking Holdings — Booking’s shares fell 3% after the travel services company reported quarterly profit and sales that beat analyst estimates amid strong travel demand, but its adjusted earnings did fall short of analyst forecasts. Booking stock was also trading near all-time highs prior to the report.

Expedia — Expedia rallied 5.6% following its quarterly results, even though the travel website operator reported a larger than expected loss. Expedia did see its highest-ever first quarter revenue, in addition to a 20% leap in gross bookings.
DoorDash — DoorDash posted a premarket gain of 4% following a smaller than expected loss for the food delivery service, as well as quarterly revenue that beat analyst forecasts. DoorDash also raised its full-year guidance, as demand for its services remains strong.
Lyft — Lyft shares plunged 15.4% in off-hours trading as the ride-hailing service issued a weaker than expected forecast for the current quarter. The stock slide comes despite better than expected quarterly results.
Coinbase — Coinbase posted better than expected quarterly results, leading to a 8.1% premarket rally for the cryptocurrency exchange’s stock. The gain comes despite a warning from the company of upcoming pressure on its subscription and services revenue. More

Banking giant HSBC on Friday defeated a proposal, backed by its largest stakeholder Chinese insurer Ping An, to consider spinning off its Asia business into a Hong Kong-listed entity.
Investors cast their votes on the proposal at the bank’s annual general meeting in Birmingham in central England, but its supporters ultimately failed to get the majority required.
HSBC’s AGM was repeatedly disrupted by environmental campaigners, with protestors vociferously challenging the bank’s climate strategy.

Noel Quinn, chief executive officer of HSBC Holdings Plc, right, Mark Tucker, chairman, center, and Peter Wong, deputy chairman, during the bank’s shareholders meeting in Hong Kong, China, on Monday, April 3, 2023. HSBC’s senior executives faced its Hong Kong shareholders from retirees to taxi drivers as the lender seeks to fend off a push in Asia to split the bank. Photographer: Paul Yeung/Bloomberg via Getty Images
Bloomberg | Bloomberg | Getty Images

Banking giant HSBC on Friday defeated a proposal, backed by its largest stakeholder Chinese insurer Ping An, to consider spinning off its Asia business into a Hong Kong-listed entity.
Investors cast their votes on the proposal at the bank’s annual general meeting in Birmingham in central England, but its supporters ultimately failed to get the majority required.

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Resolution 17 and 18 on the agenda, tabled by a group of investors led by Ken Lui, called for a “strategic review” of the company, including the spinoff proposal and fixed dividends. These motions had received support Ping An Insurance, which expressed similar views to Lui in a statement.
In March, HSBC advised investors to reject the two resolutions, a stance that was supported by investor advisory firms ISS and Glass Lewis. HSBC Chairman Mark Tucker warned at Friday’s meeting that a proposal to split up the bank would undermine its global strategy and hamper its revenue.
“The indicative results of all votes today are fully in line with the board’s recommendations. Based on these indicative results, resolutions one to 15 have passed and resolutions 16, 17 and 18, which were requisitioned by shareholders, have failed,” Tucker said.
“I’m delighted that the large majority of HSBC shareholders have voted overwhelmingly to support the bank’s strategy and draw a line under the debates on the structure of the bank. The votes will now be scrutinized, validated and the final results will be released after the meeting,” he added.
Like Barclays’ annual investor meeting in central London earlier this week, HSBC’s AGM was disrupted by environmental campaigners, with protestors repeatedly and vociferously challenging the bank’s climate strategy.

Earlier this week, HSBC reported a better-than-expected set of first-quarter results and restored its quarterly dividend.
Speaking to CNBC’s Emily Tan on Friday ahead of the meeting, Lui said that “some of the actions I took put pressure on management, so it delivered a better-than-expected report. I’m satisfied with the performance this quarter. We’ll continue to monitor the conduct of the management.”

However, HSBC CEO Noel Quinn has pushed back on Lui’s resolutions, previously telling CNBC on April 14 he does not believe that fixed dividends are “wise corporate governance and wise capital management for a bank.” He said a dividend payout ratio is more balanced and “is the model of the industry.”
Last month, HSBC said spinning off its Asian business “would result in material loss of value for HSBC shareholders.”
Quinn said management is already improving the performance of the bank and is on a “very good trajectory.”
The “special resolutions” require 75% of votes to pass, but Lui expressed confidence.
“When I submitted these resolutions, I was very confident that both of them will be passed because they can stimulate the share price to go up. As a shareholder of HSBC, even if you don’t support it, you also shouldn’t vote against it,” he said.

Michael Makdad, senior equity analyst at Morningstar, said before the vote that he did not personally expect the resolutions to clear the 75% hurdle. But he told CNBC’s “Squawk Box Asia” that the proposals reflect a longer-term issue “that’s not likely to go away for HSBC.” He predicted the bank will continue to see activist or leading shareholders putting pressure on management going forward.
Makdad said a lot of the pressure comes from the fact that HSBC operates in many countries around the world, but derives most of its profitability from its Hong Kong and the U.K. units.
“It would make sense to simplify the structure. However, as a bank, it’s not easy to simplify it,” he said.
He pointed to HSBC’s attempts to sell its French retail unit as well as its Canadian operations. “If that goes through, that’ll be great. But all of these things take time, and it’s not simple.”
In light of the banking sector’s recent woes in the U.S. and Europe, Makdad was quick to add that these do not mean that HSBC is a troubled bank.
“It’s just a bank that has some great operations [in] Hong Kong, and other places. It has some very profitable, very strong operations. And then it has other operations that maybe it doesn’t need,” he said.

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Restaurants in the fine dining category have been opening in China as locals look to spend on more than just a meal.
A similar focus on customer service set hotpot chain Haidilao apart when it opened its first Beijing location nearly 20 years ago.
But while its growth in China has slowed, other restaurants are coming in with an experience-centered strategy.

A restaurant in the Xintiandi shopping area in Shanghai on March 25, 2023. The overall number of new fine dining restaurants in China declined from 2021 to 2022, but the number of new venues doubled in 2021 from 2020, said Tang Yan, a Black Pearl representative.
Bloomberg | Bloomberg | Getty Images

BEIJING — A new restaurant scene is growing more popular across China: fine dining.
Despite the Covid-19 pandemic, a brand called Lu Style opened four new restaurants in the last three years in Beijing and Shanghai.

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At that store, Lu Style said, business brings in 4 million yuan ($579,710) a month. Meals cost about 735 yuan per person, according to reviews on China’s Yelp-like Dianping app. Judging from more than 1,500 comments, users were most enthusiastic about the service, taste of the food and “elegant” design.
That’s how restaurants are competing in a country whose culture emphasizes good food — and where the global trend of spending on experiences is taking hold.
Since Lu Style launched in 2016, more people no longer focus on just being able to eat, said Tian Junfeng, director of operations. Instead, he expects demand for social spaces will be greater.

The brand has seven restaurants — including a soft open this year in collaboration with a Shanghai art gallery. Lu Style’s cuisine comes from the province of Shandong, including many of the ingredients themselves. The restaurants offer seasonal menus and meticulous design — one outlet in Beijing claims the peony bush they transplanted to an outdoor seating area is 880 years old.
Tian said Lu Style will be focused on improving customer service in the coming months. To do so, it contracted an etiquette instructor to spend two days at each store every month, he added.

Better customer service

A similar focus on customer service set hotpot chain Haidilao apart when it opened its first Beijing outlet nearly 20 years ago.
But while its growth in China has slowed, other restaurants are coming in with a similar experience-centered strategy.
By 2018, Dianping owner Meituan started to track and rank the best performers with its Black Pearl “restaurant guide” awards. Anonymous judges annually screen restaurants for food quality, dining experience and creativity in catering to traditional and modern tastes.
The 2023 rankings selected 304 restaurants — most of which were in China, including Lu Style. Several of the venues were in smaller cities. Restaurants in Jinan, Changsha and Wuxi made the list for the first time.
The overall number of new fine dining restaurants in China declined from 2021 to 2022, but the number of new venues doubled in 2021 from 2020, said Tang Yan, a Black Pearl representative.
“The pandemic also affected consumers, and now they’re more likely to want to treat themselves,” Tang said in Mandarin translated by CNBC.
She said spending for business gatherings at the restaurants has declined slightly, but spending by individuals or families has risen by a greater scale.

One of the worries about moving back to China after spending 27 years overseas in Canada, the UK, and Singapore (and married to an Australian), was I would be missing out on the restaurant and bar scene like in other metropolis[es]

A meal out at a Black Pearl restaurant can cost as little as 164 yuan per person at Yangzhou city’s Quyuan — which plans to open three new outlets in China this year. On the other end of the spectrum is Ultraviolet by Paul Pairet in Shanghai, a French restaurant where dinner can cost over 6,000 yuan per person.
Higher-end dining options in Beijing, such as the King’s Joy vegetarian restaurant, impressed Cici Lu, a consultant in the digital assets industry who recently moved back to Beijing from Singapore.
“It was a full house,” she said, despite the $500 per person price. Lu noted the ingredients came from different parts of China, while the courses had “some very intriguing textures and flavors.”
King’s Joy has three Michelin stars, and is also on Black Pearl’s list for Beijing. Two Lu Style locations have one Michelin star each, and the France-based guide includes more than 400 restaurants in mainland China. Michelin declined a CNBC interview request for this story.
“One of the worries about moving back to China after spending 27 years overseas in Canada, the UK, and Singapore (and married to an Australian), was I would be missing out on the restaurant and bar scene like in other metropolis[es],” Lu said.
But “I found the dining scene has become more contemporary,” she said. “Younger consumers prefer dining experiences with high-quality produce, interesting concepts, and stylish venues.”

A niche market?

Overall, eating out remained one of the top three categories in which consumers in China planned to spend in — similar to prior months, according to a regular Morgan Stanley survey in late March.
For the week ended April 9, in-person dining revenue in China was up by about 50% from a year ago, according to analysis from Beijing-based BigOne Lab, an alternative data company whose backers include S&P Global.

Read more about China from CNBC Pro

However, it’s not clear whether consumers in China are making a habit of eating at nicer restaurants or simply visiting them a few times more than they might have in the past.
Christine Peng, head of Greater China consumer sector coverage at UBS, said she didn’t think there was a “broad-based upgrade trend” in restaurant spending.
“Even for the restaurant companies, what they said is during the weekends the traffic is in tremendous recovery, but during weekdays the traffic may not recover that much,” she said.
Catering sales climbed by nearly 14% year on year in the first quarter. That’s a jump from the 0.5% increase in the first three months of 2022. China ended its Covid-19 controls in December.
An increasing number of catering-related businesses dissolved or suspended operations each year from 2019 to 2021 — to more than 900,000 in 2021, according to the Qichacha business database. That figure dropped to 530,000 last year.
The number of new catering-related business registrations has risen each year, from 2.3 million in 2019 to 3.28 million in 2022, the data showed. More

Warren Buffett has a soft spot for auto insurer Geico, as he invested in the company at $2 a share back in 1976.
Geico is going through a rocky patch, suffering a $1.9 billion pretax underwriting loss in 2022. Competitor Progressive is also snapping up market share, according to an analysis from UBS.
Berkshire Hathaway shareholders will be eager to learn more about what’s next for Geico and how it plans to beat back its competition.

Display showing Gecko character for GEICO Insurance during the Berkshire Hathaway Annual Shareholder Meeting in Omaha, Nebraska.
Yun Li | CNBC

Berkshire Hathaway shareholders attending this year’s meeting will want to know more about the company Warren Buffett once called his “favorite child” – the auto insurer Geico.
With tens of thousands of shareholders in attendance, Berkshire’s annual “Woodstock for Capitalists” will be held in Omaha, Nebraska, on Saturday, the second in-person gathering since 2019. (CNBC’s exclusive coverage of the event starts that day at 10 a.m. ET.)

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Geico, viewed as the crown jewel of Berkshire’s insurance empire, has found itself in a bit of a trouble recently after losing market share to its best competitor, Progressive, in 2022 with a widening gap in underwriting margins and growth, according to an analysis from UBS. Geico suffered a $1.9 billion pretax underwriting loss last year.

Arrows pointing outwards

“I think it’s the biggest issue out there at the moment is really Geico,” said Bill Stone, chief investment officer at Glenview Trust and a Berkshire shareholder. “They’ve lost out to Progressive, who did a better job of implementing telematics … I’m certainly interested in a big update on that.”
Telematics programs allow insurers to collect clients’ driving data, including their mileage and speed.
Headquartered in Chevy Chase, Maryland, with more than 38,000 employees, Geico also experienced a 1.7 million decrease in active policies in 2022, after seeing stagnant growth in the previous year.
Ajit Jain, Berkshire’s vice chairman of insurance operations, said the biggest culprit for Geico’s underperformance is telematics.

“Progressive has been on the telematics bandwagon for … probably closer to 20 years. Geico, until recently, wasn’t involved in telematics,” Jain said at Berkshire’s 2022 meeting. “It’s been only the last two years that they’ve made a very serious effort, in terms of using telematics for segmentation and for trying to match rate and risk.”
Geico represents one area of weakness for Berkshire, which overall has been beating the broader market. Berkshire Class A shares hit a 52-week high Monday, briefly topping $500,000 again. The stock is up nearly 5% over the past month, while the S&P 500 has fallen roughly 1% amid the banking crisis.
The conglomerate tends to shine in a down market as many use it for downside protection given its diverse businesses and unmatched balance sheet strength.

Arrows pointing outwards

First love
While Geico is only a relatively small percentage of Berkshire’s sprawling empire, Buffett does have a soft spot for the insurer as it’s one of the “Oracle of Omaha’s” first investments, and perhaps among the most successful.
Buffett learned about Geico from his professor and mentor Ben Graham, who was the chairman of the board at the insurer. In 1976, Buffett invested at $2 per share in Geico when it was in financial trouble, and Berkshire acquired the rest of the company in 1995.
“It was sort of Buffett’s first love,” said David Kass, a finance professor at the University of Maryland’s Robert H. Smith School of Business. “I think he has a strong emotional and sentimental attachment to it.”
Kass recalled Buffett referring to Geico as his “favorite child” during a meeting with his students in 2005.
Claims cost Inflation
Other than closing the gap in usage-based technology, investors also want to know if Geico is taking steps to offset loss cost inflation, triggered by a surge in prices of used cars, new cars and parts.
Personal auto insurers have been plagued by a high degree of claims cost inflation, with many having posted first-quarter 2023 loss cost increases of more than 20%, said Catherine Seifert, Berkshire analyst at CFRA Research.
To be sure, Berkshire does expect Geico to return to an underwriting profit in 2023 after obtaining premium rate increase approvals from a few states, Buffett said in his 2022 annual letter. More

Apple’s first physical retail store is located in the populous city of Mumbai.
Punit Paranjpe | Afp | Getty Images

Check out the companies making headlines in after hours trading.
Apple — The tech giant added nearly 2% after an earnings beat. The company reported earnings of $1.52 per share on revenue of $94.84 billion for the second fiscal quarter. Analysts forecasted earnings of $1.43 per share on revenue of $92.96 billion.

Carvana — The used car dealer added 23% in after hours trading. Carvana posted a loss of $1.51 per share for the first quarter, coming in below estimates for a loss of $2 per share, according to Refinitiv. Revenue came in at $2.61 billion, in line with analysts’ estimates.
Lyft — Shares of the ride-sharing company fell more than 14% after Lyft posted its latest quarterly results. The company reported a net loss of $187.6 million. Revenue of $1 billion beat analysts’ estimates of $981 million, according to Refinitiv.
Expedia — Stock in the online booking company gained nearly 6%. Revenue for the latest quarter came in slightly ahead of Wall Street’s forecasts. Expedia posted a loss of 20 cents per share, wider than analysts’ expectations of 4 cents per share, according to Refinitiv.
Coinbase — Shares of the crypto-trading platform gained nearly 9%. Coinbase posted a smaller-than-expected loss of 34 cents per share on $773 million in revenue, against an expected loss of $1.35 per share and revenue of $657 million according to Refinitiv. The company had cut costs with layoffs in the quarter.
Block — The CashApp parent company gained 2.6% on an earnings beat. Block reported adjusted earnings of 40 cents per share on $4.99 billion in revenue while analysts expected earnings of 34 cents per share on revenue $4.59 billion, according to Refinitiv.

Booking Holdings — Shares lost 3% after the company did not update its guidance for the full year. Booking reported adjusted earnings of $11.60 per share against consensus expectations of $10.61 per share, according to Refinitiv. Booking also reported $3.78 billion in revenue which was also ahead of the Street’s expectations.
DoorDash — Shares of the food delivery service were up 5% after quarterly results. The company reported a loss of 41 cents per share, narrower than the loss of 58 cents per share forecasted by analysts, according to Refinitiv. Revenue came in higher than expected, at $2.04 billion versus the Street’s estimate of $1.93 billion. More