The Fortune Global 500 list illustrates pandemic effects, China’s rise and fossil fuel’s decline
Good morning. David Meyer here in Berlin, filling in for Alan this week as he takes a well-deserved break.
This year’s Fortune Global 500 list is out this morning and, as ever, it illustrates some of the most powerful industrial narratives of our age.
For the clearest visual depictions of what I mean, I urge you to visit this page of informative and beautifully rendered charts and maps, produced by our official analytics partner Qlik. But here are some facts that speak for themselves:
—Pandemic effect: The Fortune Global 500 companies experienced an overall 5% drop in revenues in 2020, the largest since 2016, and aggregate profits were down 20%, which is the biggest decline since 2009. Last year’s list contained six airlines; with their revenues down 60% in 2020, not a single one made the new list.
—China: This is the second year in a row in which mainland China (including Hong Kong) has had more companies on the list than the U.S. A decade ago there were 69 companies on the list that hailed from Greater China; now it’s 143. And, of the 107 Global 500 companies that are government-owned, over two-thirds are Chinese.
—Fossil fuel: Exxon Mobil and Royal Dutch Shell, both of which ranked at No. 1 at least twice this century, each dropped to their lowest Global 500 rankings yet, at No. 23 and No. 19 respectively. The list’s petroleum refiners saw a 36% decline in revenue. Mexico’s Pemex was the biggest money-loser of the year (again) with a $23.7 billion loss in 2020. Saudi Aramco’s two-year reign as “most profitable” company is over, with the crown passing to Apple again.
—Diversity: A year ago, there were 14 female CEOs of the Fortune Global 500. Now, the tally is 23, representing a rise of nearly two-thirds.
As for who leads the list, well, no surprise there: it’s Walmart again, for the eighth year in a row.
As ever, this year’s Fortune Global 500 is also accompanied by important stories. Toyota’s the biggest automaker on the list again, so here’s Eamon Barrett on how the Japanese giant kept production up in the face of a semiconductor shortage. Netflix is on the list for the first time, and here’s Vivienne Walt on how the company has been wooing the Saudi market. Then we have Geoff Colvin on lessons for winning in the new global business environment, and Nick Rapp and Brian O’Keefe’s handy visualization of the biggest Global 500 companies by country.
Lots to dig into! More news below.
Square will pay $29 billion in stock to buy Afterpay, an Australian "buy now pay later" firm. Afterpay is yet to turn a profit, but it's used by many retailers and Square says it was attracted by the alternative it presents to traditional credit facilities, which are apparently distrusted by younger consumers. Fortune
Pfizer and Moderna have both raised their prices in their latest EU supply contracts, which are largely about boosters. Pfizer is now reportedly charging $23.20 per dose rather than €18.40, while Moderna's jab now costs $25.50 rather than $22.60. The FT reports that the revenue gap between these mRNA vaccines and their more traditional rivals will continue to widen. Financial Times
The U.S. and U.K. have blamed Iran for an attack on a tanker off the Oman coast last Thursday. The attack on the Israeli-operated MV Mercer Street claimed the lives of a British national and a Romanian citizen. U.K. Foreign Secretary Dominic Raab: "Iran must end such attacks, and vessels must be allowed to navigate freely." His American counterpart, Antony Blinken, promised an "appropriate response", while Israeli Prime Minister Naftali Bennett said "we know how to send a message to Iran in our own way." BBC
Amazon has been hit with what is by far the biggest fine yet under the EU's General Data Protection Regulation (GDPR). As disclosed Friday in an Amazon securities filing, the Luxembourg privacy watchdog fined the firm $887 million and told it to change certain business practices. The details remain murky, but it has something to do with how Amazon uses personal data for targeted ads. Amazon will appeal. TechCrunch
AROUND THE WATER COOLER
Tesla and Apple
A new book on Tesla, by WSJ reporter Tim Higgins, claims there was a wild phone call between Elon Musk and Tim Cook in 2016, in which Cook proposed Apple buying Tesla, and Musk said he wanted to become Apple's CEO, and Cook swore at him before hanging up. However, both CEOs deny the conversation took place—they say they've never spoken at all, ever, though Musk does say he did once ask to meet Cook to discuss selling Tesla to Apple. The Verge
The world's biggest copper mine, the BHP-owned Escondida in Chile's Atacama desert, may be hit with a strike soon. Workers, who want education benefits for their kids and a one-time bonus for their work during the pandemic, overwhelmingly approved the move in a vote that ended Saturday. Union statement: "We hope that this strong vote is the decisive wake-up call for BHP to initiate substantive talks... if it wants to avoid an extensive conflict, which could be the most costly in the country's union history." France 24
The Estonian ride-hailing startup Bolt has raised new funding at a valuation of $4.75 billion, which is more than twice its previous valuation. The Uber rival formerly known as Taxify wants to become a significant player in the booming food-delivery sector. CNBC
Biman Mukherji has a fascinating piece on Udaan, an Indian e-commerce firm that helps producers and manufacturers reach the country's millions of small retailers, and that is eyeing an IPO: "Udaan has enrolled 30,000 sellers and 3 million buyers across 900 cities in India, and it reached ‘unicorn’ status faster than any other Indian tech startup when it raised $225 million in 2018. It’s now valued at $3 billion." Fortune
This edition of CEO Daily was edited by David Meyer.
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