When it comes to some of the most valuable companies in the world, there are often several factors that make them stand out from the rest. Among the most important is high workforce productivity. One interesting metric that shows workforce productivity is revenue per employee. Extremely high revenue per employee points to two key levers for a large company that allow for strong workforce productivity: scalability and strong management.
Scalability means that a company can increase the revenue and profit it generates disproportionately to increasing headcount and other costs. This is how companies drive higher margins. Effective use of technology and strong products compared to competitors can help drive scale. High revenue per employee shows that managers are using their employees well. They place them in roles that maximize their skills and productivity. As employees maximize their productivity, they also generate more revenue.
Below, I’ll detail three companies. It has generated over $1 million in revenue per employee in the past 12 months, demonstrating the productivity of its impressive workforce.
Visa: A measure of the benefit of continuing marketing down
Visa today
Visa
- 52 week range
- $252.70
▼
$331.09
- Dividend yield
- 0.71%
- P/E ratio.
- 33.94
- Target price
- $334.58
Visa NYSE:v There were approximately 31,600 employees in fiscal year 2024. Over the past 12 months, VISA generated approximately $36 billion in revenue. This results in revenue per employee of $1.1 million. The scalability of Visa is evident in its growth. Its adjusted earnings per share (EPS) grew faster than the number of employees. In 2015, the company had 11,300 employees and generated adjusted earnings per share of $2.62. In fiscal 2024, the company has adjusted earnings per share of $10.05. Adjusted EPS growth is 262%, while growth in headcount is only 180%. The company has boosted its profits by far more than its headcount over the past 10 years.
Visa underwriting position along with MasterCard New York: A In the United States, payment processing contributes to its ability to scale. New businesses likely already know that Visa and MasterCard are their only options. Therefore, Visa does not need to hire as many salespeople to convince customers to choose them over many other options. Advertising spending also becomes less necessary as its payment network grows, as most people will naturally gain exposure for their brands over time. This plays into reality, as Visa’s marketing spend has increased 79% since 2015, versus a 158% increase in total revenue.
Broadcom: Management impressively integrates VMware
Broadcom today
As of 01/24/2025 04:00 PM
- 52 week range
- $117.43
▼
$251.88
- Dividend yield
- 0.96%
- P/E ratio.
- 199.59
- Target price
- $225.83
Giant Broadcom chip Nasdaq: Avgo It also generates huge amounts of sales compared to the number of employees. Broadcom’s 37,000 employees helped the company generate nearly $52 billion over the past 12 months. This equates to approximately $1.4 million in revenue per employee. Before the company’s massive acquisition of VMware, revenue per employee was higher. It sat at around $1.8 million before Added 17,000 VMware employees.
However, the VMware integration shows how Broadcom drives efficiency. Before the merger, VMware It had about 38,000 employees. However, Broadcom expects VMware related revenue to continue, despite retaining less than half of VMware’s workers. He was doing it. VMware’s annual booking value increased 8% from Q3 2024 to Q4. Management expects this number to accelerate to 10% in the first quarter of 2025. Growth in revenues combined with reduced headcount has increased margins significantly at VMware. Broadcom has more than doubled VMware’s operating margin since the acquisition, from 30% to 70%. It’s a testament to management’s ability to integrate the business into Broadcom.
Apple: Profits have grown more than 10 times faster than headcount since 2019
Apple today
As of 01/24/2025 04:00 PM
- 52 week range
- $164.07
▼
$260.10
- Dividend yield
- 0.45%
- P/E ratio.
- 36.64
- Target price
- $238.05
Apple Nasdaq: AAPL Revenue per employee significantly outperforms the other two companies, at $2.4 million. Apple generated $391 billion in revenue over the past 12 months, with 164,000 employees. Apple has demonstrated its ability to scale by increasing its revenue and EPS at a much faster rate than the number of employees. Apple had 137,000 employees in 2019, meaning the number has grown by 20% since then. However, during that time, revenues grew by 50%. Adjusted annual EPS increased from $2.97 to $6.75, an increase of more than 127%.
Particularly strong drivers of the company’s revenue and earnings growth have come from the services segment and geographies outside of the Americas. Annual services revenue increased 108% since 2019. Gross margins in the services segment also increased significantly, up to 74% from 64% in 2019. Non-America revenue grew 56% during the period, significantly outpacing the 43% growth in Americas revenue.
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