One of the common beliefs among market observers these days is that the largest firms are hogging a disproportionate share of net income, while everyone else fights for the remaining scraps of a shrinking pie.
Well, Calcbench ran some numbers — and, um, yeah; that’s pretty accurate. No wonder another Hunger Games book is hitting the shelves.
Specifically, Calcbench examined the revenue and net income disclosures of 1,570 non-financial firms for the last four years. We found that by 2024, the 50 largest firms by revenue accounted for half of all net income for the entire study population. Meanwhile, the remaining 1,520 firms were reporting more net losses year after year and saw average net income per firm decline year after year; while the 50 big boys reported fewer net losses and their average net income went up.
Let’s unpack all that in a few charts.
Figure 1, below, shows net income for the 50 largest firms (ranked by 2024 revenue) and net income for the entire population of 1,570 non-financial firms we studied. As you can see, those 50 large firms went from 45 percent of the net income pie in 2021 to 50 percent in 2024.
We then started digging into the net income disclosures of the 1,520 smaller firms, and saw lots of red ink. So we started counting the number of net losses reported by each group. That led us to Figure 2, below.
The pittance of net losses for the 50 large firms isn’t surprising; you’re bound to see one or two every year, and a spot-check revealed no surprises. In 2024, for example, the net losses were reported by Boeing ($BA) and Walgreens-Boots Alliance ($WBA), two firms that both had rough years.
On the other hand, note the rising number of net losses reported by everyone else. One would expect to see more losses in 2022, a year racked by inflation — but then net losses kept marching upward in 2023 and 2024, when the worst of economic headwinds were supposed to be behind us.
That brings us to the total size of those net income pies. Quite simply, the pie for the 50 largest firms is getting bigger; for everyone else, it’s getting smaller. See Figure 3, below.
Those numbers are not comforting. As a whole, they suggest that smaller firms did not enjoy anywhere near as robust an economic rebound as the largest firms did in 2023 and 2024. Moreover, one has to wonder whether a return of inflation or other shocks (read: trade wars) might send even more small firms into the red in 2025.
For observers of the macro-economic scene, these are sobering questions. All you need to find the answers is Calcbench.
And for the curious, the 50 large firms we identified were as follows.
