Re:Hey, Look Who's Now The 5th Biggest Company in the US
by jetpack on Thursday November 01, 2007 @02:38AM
(#74971)
Car makers have a very low profit margin. Toyota has about 7% (and that's very high for cars -- GM has like 1%). Google has about 30% profit margin. There's definitely a lot more money in cars in general (in terms of revenue), but Google's net income for 2006 was $1 billion more than GM, despite GM having about $197 billion more in revenue. Having high revenues doesn't mean you're making a lot in profit, which is what counts.
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Re:Hey, Look Who's Now The 5th Biggest Company in the US
by ajkates on Thursday November 01, 2007 @02:51AM
(#74976)
Though, GM is probably not the best example...it's bleeding cash at the moment, and has even had negative earnings some quarters.
If you want to play the profit game, compare Google's profit to Wal-Mart, Exxon-Mobil, and CitiGroup. We're not even in the same league here. In fact, we're not even in the same order of magnitude!
Again, Google making that list (and having a high market cap) is much more an effect of it's expected growth (and high multiple) than it's actual present value as a company.