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The 2019 Fortune 500 List: The Prize of Size

From industry dominating mergers to legacy second-acts, the world’s highest-revenue-generating companies make moves that reverberate.

Consider this fact: Just 500 companies—the ones on this year’s ­Fortune 500 list, to be precise—produced enough revenue last year to equal two-thirds of the entire economic output of the United States. Think about that a minute: just 500 companies.

These same American businesses sold an astounding $13.7 trillion worth of goods and services, a record sum whether you measure it in nominal dollars or adjusted for inflation. But focus in on the numbers and you’ll discover something yet more remarkable: that just a tenth of these companies account for nearly half (48%) of that total revenue. Sharpen your microscope a bit more, and you’ll see that profits among the group are more concentrated still—with a mere 40 companies responsible for 52% of the combined earnings. Twenty-seven of these household names earned at least $10 billion in their most recent fiscal year. Six, moreover, are as rich as mighty nations, with at least $1 trillion in assets on their balance sheets.

Each year, it seems, America’s biggest companies look more and more like a set of matryoshka dolls; companies that a generation ago would have been seen as corporate titans now appear as if they could be swallowed up as midday snacks by the real behemoths. That’s one of the takeaways from this year’s Fortune 500 ranking—the 65th running of the list: The big are getting bigger, and the rich are getting richer. And, as Erika Fry explores in an opening essay, there are a host of reasons why—from the rise of corporate ecosystems, to the increasing competitive need for scale, to the power-concentrating effect of data and information technology.

This same broad narrative of American business winds through the thousands of data points we’ve curated—with some abandon, it would seem—in 45 pages of tables and charts. But perhaps more telling are the implications of that story line—which emerge in each of the features in this issue. Both AT&T and CVS have remade themselves into information-age colossi. The reinvented Ma Bell, writes Fortune’s Geoff Colvin, is counting on massive scale and reach to overcome the effects of old-economy gravity. (It isn’t exactly working.) CVS, for its part, has combined with Aetna to become the health industry’s biggest platypus: a drugstore-insurer-pharmacy benefit manager-walk-in clinic. As Shawn Tully reports, investors aren’t buying this one either.

The prize of size is driving Occidental Petroleum (No. 167 on the list) to buy Anadarko (No. 237), so it can outcompete Chevron (No. 11) in the oil-rich Permian Basin (read Jen Wieczner’s timely story). And it’s driving Wayfair into a wild, loss-leading gambit for e-commerce domination … in the very old-world realm of couches and cabinets. What’s Wayfair spending so ferociously on? Well, says Jeffrey O’Brien, the company’s 2,300 in-house data geeks should give you a hint.

Data, of course, may help a company get to the top. But it may not be enough to keep it there. That’s another—and far more important—lesson from this year’s Fortune 500.

Consider the emperor of data itself, Alphabet, which in just 14 years on the Fortune 500 has leaped from the No. 353 spot (in its erstwhile Google identity) to No. 15 today. But as Beth Kowitt reports in “Inside Google’s Civil War,” the search giant is going through the kind of growing pains that could only occur in the modern corporate era: The company’s highly skilled and in-demand workforce—who have been the engine of its historic growth—are now vocally challenging the strategy set by management.

Our incredibly talented art, photo, and graphics team helped realize this unfolding story of American business—a tale told in the grandness of the forest and the specificity of each tree—in a series of magazine covers. They include the cover we ultimately ran, created by Fortune’s information graphics editor Nicolas Rapp, which reveals in 500 gleaming golden circles a sphere encompassing the whole.

FOR0619-Fortune 500 2019-Domestic Cover
Nicolas Rapp
Nicolas Rapp

Art director Josue Evilla commissioned the stylized radio tower illustration by Tavis Coburn, which captures the venerable history and outsize ambition of AT&T. To highlight Jen’s story on Occidental Petroleum, creative director Peter Herbert worked with Liverpool-based illustrator Justin Metz to produce the stunning, twisting gasoline pump shown below.

 

FOR0619-Fortune 500 2019-AT&T Cover
Tavis Coburn
Tavis Coburn

 

FOR0619-Fortune 500 2019-Occidental Petroleum Cover
Justin Metz
Justin Metz

Karol Gadzala, based in Hamburg, produced the vivid colorscape to showcase Alphabet. And director of photography Mia Diehl commissioned our striking cover of CVS, styled and shot by husband-and-wife duo The Voorhes, as well as our Wayfair cover. In the last, photographer Stephen Lewis and stylist Michele Faro assembled a mélange of dollhouse furniture into a “500” that looks oddly modern and uncomfortable.

FOR0619-Fortune 500 2019-Alphabet Cover
Karol Gadzala
Karol Gadzala

 

FOR0619-Fortune 500 2019-CVS Cover
The Voorhes
The Voorhes

 

FOR0619-Fortune 500 2019-Wayfair Cover
Stephen Lewis; Prop styling by Michele Faro
Stephen Lewis; Prop styling by Michele Faro

Each of these images, we believe, tells more than the tale of one company. Each offers a snapshot of the whole. Just as every good story does.

A version of this article appears in the June 2019 issue of Fortune with the headline “The Prize of Size.”

More must-read stories from Fortune:

—The 2019 Fortune 500: See the full list

—Why the giants among this year’s Fortune 500 should intimidate you

—What the Fortune 500 would look like as a microbiome

—The Occidental-Anadarko merger reveals the crude truth about oil prices

—It’s all clicking for Wayfair, a Fortune 500 newcomer

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