American corporations have achieved record-breaking profits in the most recent fiscal year, significantly outperforming their European counterparts. Calculations from the Handelsblatt Research Institute reveal that the 500 largest publicly traded companies in the United States collectively generated profits totaling €1.3 trillion, a 1.5% increase year-over-year and the highest figure ever recorded.
A substantial portion of this success – approximately one-third, or €441 billion – can be attributed to the performance of six tech giants: Apple, Alphabet (Google), Amazon, Meta, Microsoft and Nvidia. In contrast, profits for the 500 largest publicly traded companies in Europe decreased by 5%, amounting to €616 billion.
The divergence in performance is becoming even more pronounced in the first quarter of the current year. U.S. companies experienced a 17% increase in net profits compared to the same period last year, while European companies saw a 9% decline. This disparity is partly attributable to a 13% appreciation of the Euro against the US dollar since the beginning of the year, which creates headwinds for European companies competing in the dollar-denominated market and reduces the value of their earnings when converted back into Euros.
Analysts are projecting continued growth, with an average profit increase of nearly 16% foreseen for U.S. companies throughout the remainder of the year, compared to a more modest 5.5% expected for European corporations.