America’s $10 Billion Club
How many of the top 500 U.S. companies generated $10 billion or more in profits in 2012?
- To be in the current US Fortune 500, a firm needed to have revenues of almost $5 billion in 2012.
- The largest U.S. corporate profit loss of all time was $99 billion at AIG in 2008.
- Taken together, US Fortune 500 companies employed 26.4 million people in 2012.
- 3 of the US Fortune 500 firms made profits of over $25 billion in 2012. 2 oil firms and 1 tech firm.
- Combined, the 17 most-profitable US firms earned more than $318 billion in profits last year.
Despite a sluggish labor market and stagnant wages for most workers, U.S. companies still managed to earn near-record profits in 2012.
We wonder: How many of the top 500 U.S. companies generated $10 billion or more in profits in 2012?
There were far fewer than 189 U.S. companies with $10 billion or more in profits in 2012. However, 189 companies were successful enough to earn at least $1 billion in profits last year, based on data compiled by Fortune magazine.
Thus, almost 40% of the Fortune 500 companies earned profits in excess of $1 billion. The company that barely made it past the $1 billion milestone was TRW Automotive, a manufacturer of automotive parts and systems based in the Detroit suburbs.
Fortune ranks the top 500 U.S. companies based on their gross revenues. To be included in the current list, a company needed to have revenues of almost $5 billion in 2012.
As a group, the Fortune 500 companies had total revenues of $12.1 trillion in 2012. That is equal to about 77% of U.S. GDP ($15.7 trillion). In fact, their combined revenues are larger than the annual economic output of all countries in the world except the United States.
There were 55 companies in the Fortune 500 that generated no profit at all in 2012. These companies — which represent over 10% of the 500 U.S. companies with the largest annual revenues — lost a combined $59.4 billion.
California-based Hewlett-Packard, a manufacturer of computers and printers, was the only company to lose more than $10 billion last year. The company lost a total of $12.65 billion, in large part due to the accounting fraud relating to its acquisition of software company Autonomy.
Other well-known companies that had losses in 2012 were Amazon, Barnes & Noble and Best Buy. The largest loss of all time occurred at AIG, which lost $99 billion in 2008, in the aftermath of the housing market crash.
The Fortune 500 companies represent just over one-eighth of the 3,687 companies traded on U.S. stock markets.
Only 38 of the Fortune 500 companies broke the $5 billion profit barrier in 2012. One of them was the entertainment and media company Walt Disney, with profits of “only” $5.7 billion.
Taken together, the Fortune 500 companies employed 26.4 million people in 2012 — a number larger than the population of the state of Texas, the second most-populous U.S. state.
The U.S. company with the highest revenues in 2012 was retail and grocery giant Wal-Mart, at $469.2 billion. Since Fortune began compiling its top 500 list in 1955, only three companies have ever held the top spot: General Motors, ExxonMobil and Wal-Mart.
There were a total of 17 U.S. companies that made more than $10 billion in profits in 2012. Three of those companies each exceeded $25 billion in profits — two oil companies and one technology company: ExxonMobil ($44.9 billion), Apple ($41.7 billion) and Chevron ($26.2 billion).
Combined, the 17 most-profitable companies earned more than $318 billion in profits last year on revenues of $2.5 trillion. Other companies among the top 17 were Wells Fargo, Microsoft, IBM, Pfizer, Intel, Johnson & Johnson and Google.
The combined profits earned by all 500 of the Fortune 500 companies in 2012 was $820 billion — just $4 billion less than in 2011, their most profitable year of all-time.