6 ms·
Profit per employee for some large tech companies
- pmjordan 17y agoAnd then there's Nintendo, at an estimated $1.6 million per employee: http://www.joystiq.com/2008/09/16/nintendos-profits-per-employee-are-higher-than-goldman-sachs/ http://www.joystiq.com/2008/09/16/nintendos-profits-per-empl...
- silentOpen 17y agoI'd be interested in knowing how Blizzard and Valve fare in this sector. Specifically, I'd like to know the labor efficiencies of running virtual world game services and digital content delivery platforms.
- pmjordan 17y agoI doubt they can beat the cash cow of * making a profit on all hardware sold * taking a cut on every copy of every game sold, at essentially zero cost to them The only comparable business is Apple's iPhone and iPod Touch ecosystem. The other console manufacturers cross-finance the hardware with game sales.
- halo 17y agoValve own Steam, and take a cut on every game sold on their platform without having to sell any hardware.
- DocSavage 17y agoIt's $967k profit per employee. The $1.6 million per employee is apparently cash flow, not profit. The most recent report has them at a great $2.9 billion profit over last year, depending on yen/$ conversion rate. http://markets.ft.com/tearsheets/financials.asp?symbol=jp:7974&type=is http://markets.ft.com/tearsheets/financials.asp?symbol=jp:79... The article says they have 3000 full-time employees even though many company functions are handled by contractors/outsourcing. The full vs. contract employee argument throws some noise into the original article's conclusions, since some of those high-tech companies probably use fewer contractors (more full-timers) than Google.
- known 17y ago# $210k profit per head in 2008: Google # Just over $30k: IBM, Yahoo, Amazon and Dell. # Around $64k: Oracle and Intel. # Around $120k: Adobe and Cisco. Does it exclude their market capitalization?
- DocSavage 17y agoYes. It's profit per employee. Market cap is based on (shares) x (stock price). Stock price is based on the whims of investors, and profitability is based on product costs and the whims of consumers :)
- axod 17y agoIBM has almost 400,000 employees? woah that's crazy.
- bitdiddle 17y agoIBM is also a vertically integrated company, they do many things like services, software, chips, etc. It's not really a good comparison.
- nostrademons 17y agoGoogle is also vertically integrated. They're famous for their NIH syndrome - they tend not to use anything developed outside the company.
- pj 17y agoVertical integration has led to some of the largest companies in history. It started with Andrew Carnegie and his steel company at the end of the 1800's. It fell out of favor around the 1970's and shifted to a mentality of focus.
- cor2madera 17y agoNot true, Look at chrome, Its mostly leveraging various externally developed pieces of sw, and then adding some sauce (process isolation) into the mix. Google unlike other companies knows how to leverage open-source for its profit and does it like no other
- schtono 17y agoAlthough it's nice to see these numbers, I'm a bit sceptic and think one should not over-interpret them. Reason: Who says this is a systematical effect due to their organizational strucuture? I know I'm being picky now, but you could also be the leader in this table if you were selling half of your assets in one year.
- pj 17y agoor lay off a lot of employees.
- danteembermage 17y agoA little googling puts Craigslist at 81 million in revenue. I don't know how much of that disappears into serving 9 billion page views a month and the payment on their Victorian mansion in San Francisco, but before that at 24 employees they're over $3 million.
- biohacker42 17y agoAnd looking at the numbers for HP and IBM, I am becoming ever more convinced that small is the way to go and big companies are just not the place to be.
- nostrademons 17y agoI'm amazed that IBM has 20 times more employees than Google. I thought I was working at a big company, but apparently there's big and then there's BIG. It was like how in one of the recent news reports, NEC just laid off more than the entire population of Google. We're peanuts compared to them.
- jballanc 17y agoOne point that that the article didn't mention, is that a very large fraction of Apple's employees are retail staff. I'd be curious to see how Apple's profit per employee measures up against Best Buy or Wal-Mart.
- warwick 17y agohttp://www.wolframalpha.com/input/?i=apple+profit+%2F+apple+employees http://www.wolframalpha.com/input/?i=apple+profit+%2F+apple+... http://www.wolframalpha.com/input/?i=best+buy+profit+%2F+best+buy+employees http://www.wolframalpha.com/input/?i=best+buy+profit+%2F+bes... http://www.wolframalpha.com/input/?i=walmart+profit+%2F+walmart+employees http://www.wolframalpha.com/input/?i=walmart+profit+%2F+walm...
- galactus 17y agoFor a 30 years old company Microsoft is still pretty impressive.
- sounddust 17y agoHeh, when I worked at Microsoft we once had a division-wide developer meeting, and a business dev guy was doing a presentation on how well the company is doing financially. At one point he said "As you can see from this chart, your division is doing quite well, earning XXX dollars in profit per developer!" At that point we all just sort of looked around at each other while trying to reconcile the difference between our salary and the number, and he paused for a few seconds. You could see a bit of discomfort on his face as he realized exactly what he said and who he said it to. I never heard this figure given in any future division meeting :)
- jodrellblank 17y agoI'm amazed that the numbers are so high. What does it cover? Do any of them do any significant profit sharing? Google provides lots of creature comforts, are they paid for by the 'profit' or are they some of the costs before profit is calculated?
- nostrademons 17y agoThis is based on net income, which is basically everything that's left over after salaries, CapEx, perks, contractors, etc. It's money that goes to the shareholders, at least in theory. (In practice, it often gets blown on overpriced acquisitions, so it's money that goes to the entrepreneurs. ;-)) This is why you want to be a shareholder and not an employee...
- indiejade 17y agoMore interesting to me is expense per employee: http://zentu.net/snaps/exp.png http://zentu.net/snaps/exp.png (Disclaimer: I studied accounting) Amazon, Google and Apple also have the most expensive employees; the cost-per-head is almost 900K.
- dxjones 17y agoSince you studied accounting, can you translate the combination of expense and profit per employee into return-on-investment (ROI) per employee?
- indiejade 17y agoManagerial accounting was my area of specialty; I was simply pointing out that there is also a cost associated with treating employees well. I think Google's numbers may be a bit high because it has so many people who work for it for free. Now, if we could get some metrics about salaries, this could become even more interesting.
- byrneseyeview 17y agoIt's not the appropriate number. Profit margin makes more sense. ROI is useful in a case where you make an expenditure now, and get back money (or savings) in the future. For example, you automate shipping for $1 million, and save $300,000 a year, for an ROI of 30%. It doesn't work for employees, except to the extent that you're taking an up-front hit ("We paid for her to get a Master's degree") in exchange for something else ("Now she's more productive").
- jonknee 17y agoWhy is that more interesting? It looks like you're dividing revenue by employee count. A high figure there just gives you efficiency, effectively the same thing that the profit per employee gives you. It says nothing about how expensive the employees are, Google isn't actually paying 900K per head.
- indiejade 17y ago
- pchristensen 17y agoThis is a cute but silly measurement, isn't it? Salaries are part of the expenses you subtract out to get profit.
- GVRV 17y agoI'm think Profit per employee of Google and Balsamiq is the same. Interesting.
- GeneralMaximus 17y agoDo the employees actually get paid that amount or is it just another cute metric?