Guest View

“ExxonMobil profits continued to soar as the price of oil soared in 2002”

In the 1970s and early `80s, the most profitable company in the world was AT&T. On Jan. 1, 1984, as a result of a court-approved consent agreement, AT&T was broken up into eight companies.

The title as the most profitable company in the world passed from AT&T to IBM. IBM held sway until the early 1990s.

From then until 2002, the most-profitable title belonged to GE (except for a brief interruption in 2000 when it went to Exxon).

The Iraq war in 2003 drove up the price of oil. The most notable beneficiary of the spike in oil was ExxonMobil, based in Irving, Texas.

ExxonMobil profits soared from $11.46 billion in 2002 to a record $21.51 billion in 2003. Its profits nearly doubled in a single year, and the $21 billion was the largest profit ever recorded by any company.

ExxonMobil profits continued to soar as the price of oil soared. In 2008 ExxonMobil recorded a profit of $45.22 billion.

But the price of oil has declined by 50 percent from the peak in July 2008, and ExxonMobil profits have declined with it. ExxonMobil profits fell to $19.7 billion for 2009, and to just over $6 billion for the quarter ending Dec. 31, 2009.

For the same quarter, Microsoft announced earnings of $6.66 billion.

At least for one quarter, Microsoft has become the most profitable company in world, exceeding ExxonMobil by more than $600 million.

 Will it last? Stay tuned to find out.

 According to Forbes Magazine (www.forbes.com) the 10 most profitable companies in the world at the end of 2008 were:

1) ExxonMobil; 2) Gazprom; 3) Royal Dutch Shell; 4) Chevron; 5) BP; 6) PetroChina; 7) General Electric; 8) Microsoft; 9) Toyota; and 10) Nestle.

For additional data sources, go to the SEC at www.sec.gov.

• • •

(Tim Raetzloff, who operates Abarim Business Computers at Five Corners in Edmonds, evaluates Puget Sound business activity in his regular column in the Beacon. In the interests of full disclosure he says, “I do own shares in Microsoft.”)