
Profit per employee for some large tech companies - DocSavage
http://royal.pingdom.com/2009/05/14/congratulations-google-staff-210k-in-profit-per-head-in-2008/
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danteembermage
A 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.

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biohacker42
And 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.

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nostrademons
I'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.

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pmjordan
And then there's Nintendo, at an estimated $1.6 million per employee:

[http://www.joystiq.com/2008/09/16/nintendos-profits-per-
empl...](http://www.joystiq.com/2008/09/16/nintendos-profits-per-employee-are-
higher-than-goldman-sachs/)

~~~
silentOpen
I'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.

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pmjordan
I 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.

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halo
Valve own Steam, and take a cut on every game sold on their platform without
having to sell any hardware.

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indiejade
More interesting to me is _expense_ per employee:

<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
Since you studied accounting, can you translate the combination of _expense_
and _profit_ per employee into _return-on-investment_ (ROI) per employee?

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byrneseyeview
It'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").

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jballanc
One 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.

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warwick
[http://www.wolframalpha.com/input/?i=apple+profit+%2F+apple+...](http://www.wolframalpha.com/input/?i=apple+profit+%2F+apple+employees)

[http://www.wolframalpha.com/input/?i=best+buy+profit+%2F+bes...](http://www.wolframalpha.com/input/?i=best+buy+profit+%2F+best+buy+employees)

[http://www.wolframalpha.com/input/?i=walmart+profit+%2F+walm...](http://www.wolframalpha.com/input/?i=walmart+profit+%2F+walmart+employees)

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galactus
For a 30 years old company Microsoft is still pretty impressive.

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sounddust
Heh, 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 :)

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known

        # $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?

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DocSavage
Yes. 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 :)

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axod
IBM has almost 400,000 employees? woah that's crazy.

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bitdiddle
IBM is also a vertically integrated company, they do many things like
services, software, chips, etc. It's not really a good comparison.

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nostrademons
Google is also vertically integrated. They're famous for their NIH syndrome -
they tend not to use anything developed outside the company.

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cor2madera
Not 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

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schtono
Although 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
or lay off a lot of employees.

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jodrellblank
I'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
This 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...

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GVRV
I'm think Profit per employee of Google and Balsamiq is the same. Interesting.

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pchristensen
This is a cute but silly measurement, isn't it? Salaries are part of the
expenses you subtract out to get profit.

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GeneralMaximus
Do the employees actually get _paid_ that amount or is it just another cute
metric?

