History’s biggest firms

IS THERE any limit to how big a company can get? If Apple’s shares rise by 9% its market value will pass $1trn. It is an astonishing sum, supported by the iPhone-maker’s staggering profits of $60bn a year, or $8 for every person on Earth. Yet it should prompt cold sweats among the firm’s managers and investors. Relative to GDP, Apple’s earnings are now so big that it is entering a danger zone that has been occupied by only a few other corporate colossi, including the East India Company and John D. Rockefeller’s firm, Standard Oil. If history is any guide, Apple will not get bigger and other tech firms in America and China, such as Amazon and Alibaba, are testing the limits, too.

The $1trn mark has been passed once before, by PetroChina, a Chinese state firm, for 15 days in 2007. But that reflected a speculative frenzy on Shanghai’s bourse. And in any case, what matters more than nominal market values is the size of a firm’s profits relative to the economy. There are no iron laws, but common...



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