All In Perspective

Posted by jns on 1 February 2006

From a report about Exxon’s latest record earnings^*, this extraordinary statement

For the full year, net income surged to $5.71 per share from $3.89 per share in 2004. Annual revenue grew to $371 billion from $298.04 billion.

To put that into perspective, Exxon’s revenue for the year exceeded Saudi Arabia’s estimated 2005 gross domestic product of $340.5 billion, according to statistics maintained by the Central Intelligence Agency.

Now, I’m not talking about the statement about Exxon’s revenues, which is extraordinary, but about the helpful “putting into perspective” that the revenues were about the same as the GDP of Saudi Arabia.

Does the average reader know more — or have more perspective on that number — knowing that it’s comparable to the GDP of a country whose economics are not terribly familiar? Please! That’s about as helpful as saying the earnings in dollars is about the same as the number of miles in a light-week, or the number of sperm the average man produces in a year (about 390 billion). Even saying that it’s nearly 5% of the US national debt is more revealing. (It is, however, only about 50% greater than Wal*Mart’s yearly revenues.)

How about something that really gives a sense of how big such a number is. Something like: imagine that you were able to spend $10,000/hour, 24/7, 365.25 days a year, a pretty breathtaking pace — for perspective, that’s over 4 new Hummer H2s each day (use the surplus to buy the gas) . It would take you over 42 thousand years to spend Exxon’s yearly revenue.

Or, suppose we were to use the money to pay out to people an amount equal to the median US income in 2004: $44.4 thousand. Exxon’s yearly revenues would pay the median income to 8.3 million workers. For perspective, that’s about 11 workers for every mile between Earth and the Sun.

To my mind, either of these comparisons gives quite a bit more “perspective” than the GDP of Saudia Arabia
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^* Steve Quinn, “Exxon Mobil Posts Record Profit for 2005“, Associated Press / Yahoo! News, 30 January 2006.