The second release for Q2 GDP was just published. This means we get a look at corporate profits across the entire economy.
Backward-looking for short-term traders. Important information for the long-term impacts on the economy.
Thread on Q2 2020 profit data 👇
Pre-tax corporate profits for the entire economy fell 11% (SAAR) to $1.8 trillion.
This is the lowest level of corporate profits since Q2 2011.
After-tax corporate profits fell 12% (SAAR) to ~$1.6 trillion.
This represents the lowest level of after-tax profits since Q1 2014.
The effective corporate tax rate rose slightly to ~13%.
Taxes paid / pre-tax corporate profits.
Pre-Tax corporate margins fells to about 9%.
Pre-Tax Corporate Profits / GDP
After-Tax corporate margins fell to about 8%.
After-Tax corporate profits / GDP
Net dividends as a percentage of pre-tax corporate profits rose to 76%, matching the peak in 2008.
Net dividends as a % of after-tax corporate profits rose to 87%, about 4% lower than the 2008 peak.
Net dividends as a percent of GDP rose to 7%. A new peak.
Over the last 10 years, pre-tax corporate profits rose only 1%, the weakest annualized growth rate in over 30 years.
Keep in mind these numbers are before adjusting for inflation.
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