Special Report

The 10 Most Profitable Companies in the World

In the second quarter of this year, U.S. corporate profits totalled $1.8 trillion after taxes. Massive corporate profit is not limited to the United States, although many of the world’s most profitable companies, including Apple, are U.S. based. Earnings of the world’s 10 most profitable companies, totalled $223.2 billion last year.

24/7 Wall St. reviewed companies’ operating income figures. While net income is the standard measure of profits, it can include items that do not reflect profitability such as extraordinary and discontinued items and sales of subsidiaries or major holdings. Earnings from continuing operations, however, excludes such items. Based on net income from continuing operations, one measure of profitability, 24/7 Wall St. reviewed the world’s 10 most profitable publicly traded companies.

Apple, the world’s most profitable company, reported in January third quarter 2014 earnings of roughly $18 billion, the highest single quarter of profits in corporate history. Record profits from services and increasingly strong sales of the iPhone and Mac continued to drive up revenue, according to the company. Johnson & Johnson wraps up the list as the 10th most profitable company in the world.

Click here to see the world’s most profitable companies. 

Three of the 10 companies — Exxon Mobil, Chevron, and PetroChina– operate in the oil and gas sector. However, while energy has historically been an extremely lucrative business, that may change in the near future. The price of a barrel of oil fell at the beginning of this year below $50 for the first time in five years. As of the middle of October, crude oil price was $48.82 per barrel, compared to the end of June 2014, when a barrel cost $100. While relatively cheap fuel is a welcome development for many motorists, the world’s largest oil companies have seen profits slip as a result.

Exxon Mobil reported profits of $33.6 billion last year, in line with its previous fiscal year’s earnings, which were down more than 40% from the year before. Chevron and PetroChina, two of the other most profitable energy companies in the world, also reported considerable declines in net income last year compared to fiscal 2013.

Similarly, while Samsung routinely makes the list of most profitable companies, the company is not necessarily exceeding expectations. Sales and operating profit fell considerably in 2014. According to the company’s financial report, the decline was largely due to poor performance in its smartphone sales.

Samsung is one of three other tech companies topping the list of the world’s most profitable companies.

Six of the world’s most profitable companies are headquartered in the United States, including global leader Apple, which reported net income of $39.5 billion in its most recent fiscal year. Of the remaining four, two are based in China, one in South Korea, and one in Japan.

To identify the most profitable companies in the world, 24/7 Wall St. reviewed the highest earnings from continued operations — a measure of net income — for public companies around the world with revenue of at least $20 billion. All company financial data was obtained using the Capital IQ Screening tool, accessed by researcher Brian Zajac on October 13, 2015, and are as of the most recent fiscal year for each company.

Financial statements of banks cannot be compared fairly to statements of other types of companies, so banks, which would have made up seven of the 10 most profitable companies in the world, were excluded from our analysis. Banks generate income from interest paid by borrowers, a fundamentally different process than that of manufacturing and service companies. Also, large profits from banks do not indicate the same kind of success they do for other companies.

These are the 10 most profitable companies in the world.

10. Johnson & Johnson (NYSE:JNJ)
> Earnings from continued operations:
$16.3 billion
> Total revenue: $74.3 billion
> Headquarters: United States

Three brothers, Robert Wood Johnson, James Wood Johnson and Edward Mead Johnson, founded Johnson & Johnson in 1886. The company’s operating segments range from consumer products to professional medical equipment to prescription drugs. Its consumer products include such household brand names as Listerine, Band-Aid, Tylenol, and Motrin. The company’s major prescription drugs include treatments for cancer, heart and infectious diseases. Johnson & Johnson reported revenue of $74.3 billion in fiscal 2014, the smallest sales figure among the world’s 10 most profitable companies. The company, which is also the only pharmaceutical on this list, reported earnings from continued operations of $16.3 billion.

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9. Wal-Mart Stores Inc. (NYSE:WMT)
> Earnings from continued operations:
$16.8 billion
> Total revenue: $485.7 billion
> Headquarters: United States

Although Wal-Mart is by far the largest company in the world by revenue, which in its fiscal 2015 totaled $485.7 billion, it is only the ninth most profitable company. In October, the retail behemoth said it is now expecting flat sales for fiscal 2016. Among the reasons Wal-Mart cited for the adjustment were higher labor and health care costs. The revision also reflects the company’s attempts to improve in-store customer experience, and to forge an e-commerce business capable of competing with the likes of Amazon.com. A number of analysts who cover Wal-Mart believe it cannot curb labor costs. The world’s largest retailer faces challenges in the e-commerce business, and it also has to compete with successful big box retailers Target and Costco, and dozens of other retailers, including J.C. Penney, Sears, and Kmart.
8. China Mobile Limited (SEHK:941)
> Earnings from continued operations:
$17.6 billion
> Total revenue: $103.4 billion
> Headquarters: Hong Kong

China Mobile is the largest provider of wireless services in the largest wireless market in the world. The company, which provides both 3G and 4G services in China, reported it had 820 million customers as of the end of August. Its most important relationship with a U.S. company is its carrier deal with Apple. China Mobile needed the iPhone to keep pace with its two smaller competitors — China Unicom and China Telecom — both of which support the iPhone. Apple needed China Mobile because it has staked most of its future growth on customers from the People’s Republic. Like a few of the world’s most profitable companies, China Mobile’s earnings of around $17.6 billion was down from the previous year.

7. PetroChina Co. Ltd. (SEHK:857) (NYSE: PTR)
> Earnings from continued operations:
$19.2 billion
> Total revenue: $368.1 billion
> Headquarters: China

PetroChina, which is publicly traded on the NYSE, is controlled by China National Petroleum Corporation, a state-owned corporation. China’s other large state-owned oil company is Sinopec — China Petroleum and Chemical Corporation. The two companies are in almost exactly the same businesses as their Western counterparts. Each explores for, refines, and transports oil and oil byproducts. Both companies have also begun the process of moving from government to private ownership. China became the largest importer of oil as of late 2013, passing the United States. PetroChina has also been affected by the global decline in crude oil prices over the past several years. A barrel of oil now costs less than $50, compared to $100 at the end of June 2014. Perhaps as a result, PetroChina’s earnings of around $19 billion were down by over 22% from the previous year.
6. Toyota Motor Corporation (TSE:7203) (NYSE: TM)
> Earnings from continued operations:
$19.2 billion
> Total revenue: $227.0 billion
> Headquarters: Japan

Toyota is one of the three largest car companies in the world and vies for the No.1 spot each year with GM (NYSE: GM) and VW. VW is the larger company by revenue, but Toyota’s earnings exceeded its rival by nearly $6 billion. In its last fiscal year, according to Toyota, “consolidated vehicle sales totaled 8,971,864 units, a decrease of 144,169 units compared to the previous fiscal year.” North America is by far Toyota’s largest market, with vehicle sales of 2,715,173 units, followed by 2,153,694 in its home market of Japan. Toyota is run by Akio Toyoda, a descendant of the family that founded the company in 1937. Toyoda is most well known in the United States for enduring brutal questioning from a congressional committee in 2010 after Toyota recalled 6 million cars in America.

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5. Chevron Corporation (NYSE:CVX)
> Earnings from continued operations:
$19.3 billion
> Total revenue: $192.3 billion
> Headquarters: United States

Oil company Chevron ranks No. 3 on the Fortune 500, just behind Exxon Mobil and ahead of Berkshire Hathaway. Like its larger peer Exxon Mobil, falling oil prices have hurt Chevron’s earnings. Chevron’s earnings from continued operations have declined in each of the company’s last three fiscal years. Chevron’s new tagline, “Power of Human Energy,” is a way to rebrand itself as a provider of clean fuel. Nevertheless, Chevron’s primary businesses are the exploration and production of oil and natural gas. It is also the owner of pipelines, ships, and it produces gasoline and lubricants.

4. Berkshire Hathaway Inc. (NYSE:BRK.A)

> Earnings from continued operations: $20.2 billion
> Total revenue: $189.7 billion
> Headquarters: United States

Berkshire Hathaway is the flagship company of famous investor Warren Buffett’s empire. It holds stock in public companies Buffett has bought as investments, and its portfolio also includes wholly owned corporations such as huge railroad company BNSF, Kraft Heinz, GEICO Auto Insurance, and Heinz. Berkshire also owns several small companies, including Buffalo NEWS and Nebraska Furniture Mart. Among the publicly traded corporations in which Berkshire owns shares are Wells Fargo (NYSE: WFC), IBM (NYSE: IBM), and American Express (NYSE: AXP). Berkshire Hathaway’s earnings exceeded $20 billion in its latest fiscal year, one of only four companies reviewed with earnings above $20 billion.

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3. Samsung Electronics Co. Ltd. (KOSE:A005930)
> Earnings from continued operations:
$21.4 billion
> Total revenue: $188.9 billion
> Headquarters: South Korea

South Korea’s Samsung is well known in the United States for its smartphones, which compete directly with Apple’s iPhone. In fact, according to some market research companies, Samsung’s phones outsold the iPhone in the United States early last year. However, that period was short lived. Earlier this year, sales of the iPhone 6 family of smartphones bested the Samsung Galaxy family. The company’s earnings fell in its recent fiscal year by nearly 35% from the previous year to $21.4 billion. Relatively weak smartphone sales contributed to the decline, according to Samsung.

Samsung is much more than a smartphone manufacturer. The largest company in South Korea also produces televisions, home appliances, computers, and lighting products. Samsung Electronics is part of the larger Samsung Group, which is controlled by the founding Lee family.
2. Exxon Mobil Corporation (NYSE:XOM)
> Earnings from continued operations:
$33.6 billion
> Total revenue: $369.4 billion
> Headquarters: United States

Although named differently, Exxon Mobil can trace its roots to a company founded in 1870. Today, it is the world’s largest oil company. Like most of its rivals, its revenue and earnings are substantially affected by oil prices. In its last reported quarter, due to a drop in the price of crude, Exxon’s profits fell 52% to $4.2 billion. Based on last year’s revenue, Exxon was No. 2 on the Fortune 500. Exxon is more diversified than many other energy companies. In addition to exploring for, producing, and refining oil, Exxon also operates in the chemical and alternative energy business. Exxon’s market cap ranks second to Apple’s at $405 billion.

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1. Apple Inc. (NasdaqGS:AAPL)
> Earnings from continued operations:
$39.5 billion
> Total revenue: $182.8 billion
> Headquarters: United States

Apple is among the most rapidly growing large multinational companies in the world due to a string of product successes that began over a decade ago and include the Mac, iPod, iPhone, and iPad. Apple has married these with huge content operations such as iTunes and the App Store. Apple is the largest company in the world based on its market cap of about $672 billion. Last year, Apple reported revenue of $182.7 billion and earnings of nearly $40 billion. Last quarter alone, Apple sold 47.5 million iPhones, 10.9 million iPads, and 4.8 million Macs. Company management has made it clear that for Apple to grow it has to have impressive sales in China, the largest wireless market in the world.

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