What: Global economic profit has rebounded to record highs, led by technology giants, capital growth in North America and China, and a resurgence in value creation across key sectors.

Why it is important: This rebound demonstrates how technology, regional capital flows, and strategic innovation are reshaping global profit pools and driving uneven recovery across regions and industries.

After years of decline, global economic profit has surged to an all-time high, reaching $1.2 trillion per year between 2020 and 2024—50 percent above levels seen in the late 2000s. This resurgence is largely attributed to the extraordinary performance of the “Magnificent Seven” technology companies, which alone generated $247 billion in economic profit, as well as robust capital growth in North America and China. While technology and digital solutions have been central to this rebound, North American consumer goods, pharmaceuticals, and industrials also contributed significantly, and Chinese companies saw strong gains in consumer products and technology. However, the recovery is not uniform: Europe’s economic profit has remained flat, and 17 percent of European companies, especially in consumer and retail, are under transformation pressure or at risk of restructuring. The energy and materials sector saw mixed results, with declines in Asia, Europe, and North America offset by gains in Latin America and the Middle East. The data underscores the importance of creating value above the cost of capital and highlights the need for strategic adaptation in a rapidly evolving global landscape.

IADS Notes: The rebound in global economic profit to all-time highs between 2020 and 2024 reflects a profound shift in value creation, driven by technology giants, capital growth in North America and China, and the rapid transformation of Asia-Pacific’s retail and consumer sectors. As highlighted by BCG in June 2025, companies are navigating a landscape shaped by technological disruption, multipolarity, and the emergence of the Global South as a powerful economic force. Visa’s January 2025 outlook confirms that global economic growth is regaining momentum, with North America and China leading the recovery, while Sifted’s June 2025 report reveals that US founders are aggressively adopting AI and scaling businesses faster than their European peers. However, the recovery is uneven: BCG’s July 2025 analysis shows that 17% of European companies, particularly in consumer and retail, remain under transformation pressure, facing margin challenges and restructuring risks. Meanwhile, Asia-Pacific’s retail sector, according to BCG in April 2025, is leveraging digital innovation and strategic risk-taking to drive growth, underscoring the region’s increasing influence on global profit pools and investment flows.