SG&A stands for “sales, general, and administrative” costs, and encompasses pretty much any cost not directly related to making a product or delivering a service. Marketing, shipping, utilities, rent, coffee in the breakroom, ficus trees in the lobby — all of that, and more, rolls into SG&A costs.

We were curious about two questions. First, how much have SG&A costs risen for the S&P 500 in the last several years? Second and more important, how much have those costs risen as a percentage of revenue? 

The first is easy. Using our Bulk Data Query tool, we pulled quarterly SG&A costs for the S&P 500 from the start of 2020 through second-quarter 2024. In total those costs rose 21.6 percent, from $482.9 billion to $587.3 billion. Average SG&A costs per company rose 25.5 percent over the same period, from $1.08 billion to $1.35 billion.

Over those same 14 quarters, however, revenue rose even more: up 38.1 percent for the whole S&P 500 altogether, and up 42.1 percent for the average firm.

Figure 1, below, compares revenue and SG&A costs on an annual basis, since fussbuckets out there will say quarterly revenue fluctuates too much to be a good yardstick.

It’s a bit hard to see the change in those SG&A costs compared to revenue, but clearly revenue (blue) has been rising more than the costs (red).

Meanwhile, Figure 2, below, shows SG&A costs as a percentage of revenue for the last 14 quarters. The fluctuations there do roughly correspond to inflationary periods, such as early 2020 when the pandemic threw everything into turmoil, and mid-2022 into mid-2023, when costs were rising faster than many companies could address through pricing changes. 

By late 2023, however, inflation had decelerated and companies had adjusted their pricing as necessary, so SG&A costs as a percentage of revenue started to trend downward.

Macro-theorists could ask whether the falling lines in 2024 are reflective more of higher prices driving higher revenues, or lower demand leading to job cuts, fewer shipping costs, less utility needs, and the like. That’s not our question to answer. We just provide the data to raise it.