Charting America's Most Profitable Companies
It’s been a rough start to 2020 for the U.S. economy, with the Bureau of Economic Analysis reporting a 12.3 drop in corporate profits in the first quarter. The most profitable U.S. companies have proved no exception to this downturn, although things are starting to look up for some.
- U.S. corporate profits fell by 12% in the first quarter of 2020.
- Berkshire Hathaway, the most profitable U.S. company, posted a net loss of $50 billion in the first quarter.
- Profits at JPMorgan Chase, the most profitable financial company, fell 69% in the first quarter.
- Some profits may be looking up: Microsoft posted a 22% increase in net income in the third quarter.
Our data comes from the 2020 edition of the Fortune 500. For our viz, each of the 50 most profitable companies are represented by a bubble labeled with that company’s logo and its profits. A larger bubble and darker shade of green indicates a more profitable company, while a smaller bubble with lighter shade of blue indicates a less profitable company. Our viz has categorized these companies by industry.
Top 10 Most Profitable Companies in the U.S.
1. Berkshire Hathaway (Insurance): $81.4B
2. Apple (Computers & software): $55.3B
3. Microsoft (Computers & software): $39.2B
4. JPMorgan Chase (Internet services & retailing): $36.4B
5. Alphabet (Internet services & retailing): $34.3B
6. Bank of America (Internet services & retailing): $27.4B
7. Intel (Electronics, electrical equipment & electronic components): $21.05B
8. Wells Fargo (Financials): $19.5B
9. Citigroup (Financials): $19.4B
10. Verizon Communications (Telecommunications): $19.3B
The most profitable U.S. company by far is the Berkshire Hathaway, the insurance conglomerate run by billionaire Warren Buffett. At over $80 billion in 2019 profits, Berkshire Hathaway is more profitable than any company worldwide except for oil giant Saudi Aramco.
Even mighty Berkshire stumbled in the first quarter of 2020 amid the global economic shutdown triggered by the coronavirus pandemic: the company posted a nearly $50 billion loss, the largest ever in its history. This loss, along with Buffett’s seeming lack of response to adjusting the company’s portfolio, has led some to question whether the “Oracle of Omaha” has lost his touch, while others insist that Buffett will again be proven correct with a steady “buy-and-hold” strategy.
Following Berkshire Hathaway on the most profitable list is Apple, a company which had only gained in earnings 2.5% annually as of March 2020. Analysts seem optimistic that the technology company will be able to bounce back with increasing consumer spending and confidence. And there is reason to believe: Microsoft posted strong year-over-year earnings growth in the third quarter of 2020, citing minimal impact of the coronavirus.
A noticeable absence on the list is Amazon, the world’s largest retailer. While a large company by market capitalization, Amazon still has a relatively low profit. This is because the company re-invests much of its revenue into the company, with the expectation of higher profits in the future. The strategy has paid off, while some wonder how long it can continue.
What companies are you surprised to see among the most profitable? Are there any you’re surprised not to see? Will corporate profits rebound in the coming quarters? Let us know in the comments and share with your friends.