Discover the Prestige of the Fortune 500

Discover the Prestige of the Fortune 500

The Fortune 500 list comprises 500 of the largest companies in the US, ranked by their annual revenues for the respective fiscal years. Compiled and published by Fortune magazine, this list serves as a hallmark of prestige and a measure of corporate success.

Key Takeaways

• The Fortune 500 list ranks the 500 largest US companies by total revenues each fiscal year.
• Published annually by Fortune magazine, the list highlights the top American performers in the business world.
• Inclusion in the Fortune 500 implies a recognition of quality and stature in the corporate sphere.
• The ranking has been published since 1955, reflecting changes and trends in the US economy.

The Foundation and Evolution of the Fortune 500

Fortune magazine, established in 1929 by Henry Robinson Luce, has been a leading voice in business publications since its inception. The magazine introduced its first list of America’s most successful companies in 1955, focusing on public and private enterprises’ influence and magnitude.

Initially known as the Fortune Industrial 500, its name was later shortened. Only companies incorporated in the United States that file financial statements with government bodies are eligible for inclusion. Companies excluded are foreign corporations, firms consolidated by other companies, and those failing to report complete financial statements for at least three quarters of the fiscal year.

As of 2020, corporations are ranked using reported financial revenues on their 10-K filings or similar financial statements. Many of these corporations also feature on the S&P 500 Index.

Over 1,800 different American companies have been listed since the Fortune 500’s creation. The list has witnessed vast changes due to mergers, acquisitions, bankruptcies, and shifts in industry trends. It serves as an indicator of economic health, reflecting periods of stability and recession.

Highlights and Record-Breakers

In 2020, Walmart reigned supreme for the eighth consecutive year, with impressive revenues of $524 billion. Following closely was Amazon with $280.5 billion in revenue, ahead of ExxonMobil’s $265 billion. Present in the top five were Apple and CVS Health.

The top three most profitable companies of that year showcased exceptional earnings:

• Berkshire Hathaway with net profits of $81.4 billion.
• Apple earning $55.2 billion in net profits.
• Microsoft closing with $39.2 billion in net profits.

Noteworthy entrants on the 2020 list include Dow, Baker Hughes, and Uber, marking their impactful ascension.

Transformation Through Time

Edgar P. Smith, an assistant managing editor at Fortune, conceptualized the Fortune 500 list, which originally featured companies in manufacturing, mining, and energy sectors only, with inclusion requiring $49.7 million in revenue.

Reassessing its scope in 1995, the Fortune 500 began embracing service companies. This significant shift allowed companies like Walmart, AT&T, and Sears Roebuck to secure high spots on the list. Consequently, the change mirrored broader economic trends, ensuring that today’s list remains adaptable and inclusive of evolving business verticals.

Related Terms: Public and private companies, Fiscal year, Revenue, Corporate success.

References

1. Fortune. “About Us”.
2. Fortune 500. “History of the Fortune 500: Light Bulb for Business”.
3. Fortune. “Methodology for Fortune 500”.
4. Fortune. “Fortune 500: 1955 Full List”.
5. Fortune 500. “Walmart”.
6. Fortune 500. “Amazon”.
7. Fortune. “Fortune 500”.
8. Fortune. “History of the Fortune 500”.
9. Fortune. “Fortune 500: 1995 Full List”.
10. Fortune. “Walmart Company Profile”.

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