What’s the Fortune 500?

In a letter proposing the enterprise journal to advertisers in 1929, Time founder Henry Luce envisioned the publication as a solution to “reflect Industrial Life in ink and paper and word and picture, as the finest skyscraper reflects it in stone and steel and architectural design.”

Created over three a long time after Fortune’s start, the Fortune 500 was first a shot-in-the-dark thought by a journalist hoping to elucidate the world of enterprise to a wider viewers. The checklist is now the benchmark for corporations all over the world and a constant metric with which to evaluate the nation’s financial well being.

With the discharge of the 2024 Fortune 500 proper across the nook, listed here are the fundamentals on Fortune’s flagship checklist.

What’s a Fortune 500 firm?

Merely put, the Fortune 500 is a listing of the most important 500 U.S. corporations, private and non-private, ranked based mostly on income. 

Buyers use the checklist to trace the rise and fall of American corporations and make conclusions concerning the nation’s financial well being, and firms use it as a solution to assess its development and aggressive edge from yr to yr. For lecturers, business professionals, and enterprise leaders, the Fortune 500 is a solution to be taught which companies and industries are rising.

How do corporations get on the Fortune 500?

Not all corporations are eligible for the Fortune 500. These eligible embody included and operated within the U.S. which file monetary statements with a authorities company, akin to publicly listed corporations, and personal corporations that file with a authorities company. Firms included exterior the U.S. aren’t eligible for the checklist, nor are personal corporations that don’t file by authorities companies. 

For corporations assembly this standards, there’s a problem to be eligible for the checklist. Yearly, Fortune units a income threshold for corporations to fulfill to be thought of for the checklist. In 2022, all listees needed to have made at the very least $7.24 billion in income.

When will the brand new Fortune 500 checklist come out?

The Fortune 500 will likely be launched online on June 4, 2024. You’ll find the 2023 checklist here.

When did the Fortune 500 launch?

Fortune’s Assistant Managing Editor Edgar P. Smith launched the checklist in 1955, when Fortune was underneath Time’s umbrella. It had an early moniker of the “Annual Directory of the 500 Largest Corporations.”

Within the mid-Nineteen Fifties, the U.S. economic system was booming, however after a long time of financial strife—together with the Nice Despair and the financial fallout of two world wars—corporations had been gradual to indicate any optimism, a Fortune story from 1995 recalled.

Regardless of the explosion of thriving companies, the success of those corporations had been poorly documented, Loomis wrote. Fortune started compiling a listing of the most important U.S. corporations for its inner use, however Smith had one other thought: “I think that our readers just might be interested in this list,” he stated.

Compiling the checklist was a slog for Fortune’s employees. After it was launched to the general public, the angle in direction of the Fortune 500 shifted. It was a “box-office smash, no question.” The checklist grew to become the touchstone for monitoring U.S. companies and their rippling affect.

“In its entirety, the 500 has been a wide window on the U.S. economy and a reference point for all,” the Fortune story stated. “It has been cited by Presidents and Congressmen, dissected by economists, and viewed by business leaders—still yearning for normality and never quite finding it—as the Bunyanesque yardstick of industrial progress.”

How a lot has the Fortune 500 modified over 70 years?

In 1955, General Motors topped the Fortune 500, reporting over $9.8 billion in income and $806 million in earnings. It’s stayed on the checklist yearly since— final yr, it sat at No. 21. Different corporations within the unique prime 10 embody U.S. Metal, General Electric, Chrysler, Armour, Gulf Oil, Mobil and DuPont.

Firms akin to GM and Mobil—which merged with Exxon in 1999 and ranks No. 3 on 2023’s checklist—have held their floor on the checklist for many years. Over 1,800 corporations have been listees over the Fortune 500’s 70 years.

At this time, e-commerce and retail giants prime the Fortune 500, with Walmart holding the highest spot, the place it’s been for 11 years. Amazon had been Walmart’s runner-up 4 years in a row.

In 1995, Walmart—first opened in 1962—was the rookie with the best rating on the five hundred, coming in at No. 4. 

At this time’s Fortune 500 corporations are additionally making greater than the $9.8 billion GM reported in 1955. GM made almost $172 billion in income in 2023, and Walmart reported $611 billion in 2023 income.

In 2023, the Fortune 500 corporations had their highest ever mixed income of $18.1 trillion, with the highest 10 companies incomes over $3.7 trillion, or about 20% of the checklist’s whole income.

Who else has been on the checklist yearly?

A cadre of fewer than 50 companies have graced the checklist yearly for the reason that starting. Moreover GM and ExxonMobil, they embody pharmaceutical giants akin to Pfizer and Merck, in addition to acquainted food and drinks manufacturers like PepsiCo, Coca-Cola, Kraft Heinz, and General Mills.

Who had been the 2023 Fortune 500 freshmen?

On the opposite finish of the spectrum, the Fortune 500 noticed some fresh faces, together with Airbnb and Lululemon. In whole, the 15 new corporations becoming a member of the checklist made $146.2 billion in income and had a mean development fee of over 50%.

Skechers, ServiceNow, EQT, and Coupang had been among the many checklist’s different newbies.

Have CEOs main Fortune 500 corporations gotten extra various?

For the primary twenty years of the checklist’s existence, the CEOs representing the Fortune 500 corporations had been demographically homogeneous. That started to alter in 1972, when Katharine Graham grew to become CEO of the Washington Submit, and subsequently the first woman CEO of a Fortune 500 firm. Fifteen years later, Clifton Wharton grew to become the first Black CEO of a Fortune 500 firm after taking up at TIAA. Former Xerox CEO Ursula Burns grew to become the first Black woman to helm a Fortune 500 firm in 2009.

Final yr marked the primary time that ladies made up over 10% of CEOs of the nation’s strongest corporations, with 52 corporations of the five hundred run by girls. 

Whereas the Fortune 500 had its near-record excessive proportion of Black CEOs final yr, making up eight of the checklist’s 500 corporations, that’s nonetheless only one.6% of the listees. 

Executives agree that there’s not a fast repair to constructing range among the many highest ranks of those corporations, with few individuals of coloration in administration tracks.

“The tracks that lead to the CEO jobs are primarily P&Ls,” Michael Hyter, chief range officer at consulting agency Korn Ferry, stated in 2021. “There are a lot of people of color in support roles [accounting, marketing]—lots. That’s not what gets you into the CEO job.”

What different lists does Fortune have?

Because the introduction of the Fortune 500, Fortune has launched extra lists to accommodate the expansion of companies worldwide. Fortune 500 China and the Global 500 have fun the most important corporations in China and the world over, respectively. 

Others, such because the Most Powerful Women checklist and 40 Under 40 honor people separating themselves from the pack.

Discover all of Fortune’s rankings here.

Which U.S. state has probably the most Fortune 500 corporations?

For the second yr in a row, Texas has probably the most Fortune 500 corporations of every other state. Residence to ExxonMobil and pharmaceutical producer McKesson, the state’s Fortune 500 listees racked up 26% of the checklist’s income,  totalling $2.6 trillion.

The Lone Star State has turn into in style amongst CEOs for its low price of residing and lack of company or particular person state revenue tax.

States akin to Wyoming and Montana are dwelling to zero Fortune 500 corporations.