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Tuesday, May 1, 2012

Importance of corporate revenue

I saw a similar chart to this on TV the other day and I found it interesting.  Check this out.

The corporate profit margins are at the highest levels on the chart going back to the 1940s.  That would seem to limit any more significant earnings growth from cost cutting measures.  Therefore, revenue growth will be the main driver for increased earnings going forward.  With many corporations getting nearly 50% of their revenue from outside the U.S., the global economy can have a big impact on the numbers.  I suspect future earnings seasons will see investors paying as much or more attention to revenue numbers as the actual earnings.


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