Here are the top 10 most profitable companies this year…
CNN Money shares…
1. Exxon Mobil
Like last year, Exxon was edged out as the largest company in the U.S. (that crown again goes to Wal-Mart), but it can boast about being the most profitable. With the recession past it, Exxon boosted earnings 59% thanks to rising oil prices driven by a recovering world economy. Oil isn’t everything to Exxon.
After its 2009 mega-deal for XTO, natural gas now accounts for half of Exxon’s global production. But even amid sluggish natural gas prices, Exxon remains in a league of its own on our list: its $30.5 billion in profits are a staggering $10 billion more than its closest oily competitor, Chevron, and more than 52 times the size of the median profits in the 500.
Even before its proposed mega-deal with T-Mobile this year, AT&T was on a roll. In 2010 the iPhone sold like gangbusters; its network quality saw some improvements; and wireless data revenues jumped by almost 30%–the highest among the industry’s giants.
Profits rocketed nearly 60% during the year, helped by a few notable divestitures, to make AT&T the second most profitable in the Fortune 500. How long it holds that ranking depends on how attractive AT&T remains to consumers after losing exclusive rights to the iPhone to Verizon, and whether it can bring even more meaningful boosts to its network .
The headline number was good: Chevron boosted earnings 82% in 2010. Better refining margins and higher crude prices drove profits at the second biggest U.S. oil company. What’s not so good: Chevron only managed to replace a quarter of the oil and gas it pumped out of the ground.
Last year marked Chevron’s lowest reserve-replacement ratio in almost a decade, and put it far below the industry goal of replacing 100% of reserves every year. CEO John Watson is following his predecessor’s moves to increase production but is running into trouble finding new projects.
Even without a hot-selling mobile phone or tablet, Microsoft earned more than any other tech heavyweight (yes, even more than high-flying Apple). It has Windows 7 to thank. Microsoft blew away Wall Street last year when it said it had sold 175 million copies of its operating system since its release in late 2009. That helped boost profits 29% at the tech bellwether.
5. J.P. Morgan Chase & Co.
J.P. Morgan is the undisputed leader among U.S. banks, and proved it in 2010 by earning the most in its history
– even more than it had in boom times. The bank posted profits across its major businesses — from credit cards to stock underwriting to corporate credit — as the economy recovered and loan losses fell.
Reserves for those bad loans were trimmed, which allowed billions to flow to the bottom line. J.P. Morgan still faces litigation stemming from mortgage documentation, and from investors seeking retribution for soured mortgage securities. For now, J.P. Morgan remains one of the world’s strongest banks.
6. Wal-Mart Stores
Wal-Mart defended its top spot on the Fortune 500, but it slipped three notches on our list of the most profitable. The cause: recession-weary shoppers. In the depths of the downturn, Wal-Mart slashed prices on everything and attracted American consumers.
Wal-Mart couldn’t keep the strategy going in 2010: The company posted U.S. same-store sales declines for the entire year. Dollar store chains and online merchants have eroded some of Wal-Mart’s appeal. Its foray into chicer clothes didn’t help results either.
7. International Business Machines
CEO Sam Palmisano’s push into software and services is beefing up Big Blue. Profits jumped 10% last year after rising throughout the recession. The improving world economy in 2010 had more companies using IBM to handle customer service processes and other tasks.
Palmisano says cloud computing and analytics software are the next frontiers, and he’s investing heavily in them. IBM’s “Smarter Planet,” for instance, uses computer technology to monitor road congestion and hospitals.
With all the hit inventions — the iPhone, the iPad, the App Store — the world’s hottest company is fast becoming one of the most profitable, too. Apple’s bottom line jumped by 146% in 2010 after iPhone sales exploded worldwide and its brand new iPad began, well, padding the company’s earnings.
Other tech giants might not want to hear this either: Apple doesn’t show signs of slowing down. In the last quarter of 2010, Apple posted record sales and profits.
9. Johnson & Johnson
J&J had one of the most difficult years in its history, replete with drug recalls, bad press, and a falling stock price. For anyone else the year would have been disastrous. Yet J&J managed to post a 9% rise in profits.
That growth illustrates why the pharmaceutical giant is such a notable company. With businesses in medical devices, prescription drugs, and consumer products like Aveeno skin lotion, J&J can weather almost anything. It’ll have to win back customers, though, as recalls of Tylenol and other over-the-counter drugs sent sales in that division plunging 29% in the fourth quarter.
10. Berkshire Hathaway
It was full steam ahead for Warren Buffett’s Berkshire Hathaway after its mega-deal for railroad company Burlington Northern Santa Fe closed in 2010. Berkshire earnings jumped 61% as Burlington’s earnings surged, the rising stock market boosted the value of Berkshire’s stock and derivatives holdings, and a growing economy helped all of its subsidiary companies.
Burlington Northern alone added $2.2 billion to Berkshire’s bottom line. Still, Buffett remained modest about the results. The increase in Berkshire’s per-share book value–his favorite measure of performance–lagged the S&P 500′s total return by two percentage points in 2010, only the 8th time it has trailed the index in 46 years.
Get the entire list at CNN Money!