Which sectors keep the most of each dollar? Net margin by sector, from the filings
Net margin — net income divided by revenue — is the plainest answer to "how much of a dollar of sales survives as profit". Here is how it looks sector by sector, using only what companies reported to the SEC.
How the table is built
Every row below is a median, not an average. A single outlier would drag an average upward; it does not move a median. Margins above 100% are excluded outright — operating income cannot exceed total revenue, so a figure above it means the revenue line was read wrong. The universe is limited to companies reporting at least $1 billion in revenue, because tiny revenue bases produce meaningless percentages. Two kinds of company are excluded, each for a reason explained on its own page: those that book the gross value of transactions they handle as revenue, and those whose reported operating income is at least as large as their revenue — arithmetically impossible, and a sign that the revenue line does not hold the company's total revenue.
| Sector | Companies | Median net margin | Highest in sector |
|---|---|---|---|
| Financials | 191 | 13.5% | Manulife Financial 68.5% |
| Utilities | 82 | 12.5% | GFL Environmental 58.0% |
| Technology | 298 | 8.5% | Joyy 98.8% |
| Real estate | 74 | 8.2% | Simon Property 84.3% |
| Healthcare | 161 | 6.0% | United Therapeutics 41.9% |
| Materials | 134 | 5.6% | Wheaton Precious Metals 63.6% |
| Industrials | 323 | 5.4% | Comfort Systems USA 55.8% |
| Energy | 96 | 4.6% | Valaris 41.3% |
| Consumer staples | 83 | 4.5% | British American Tobacco P.L.C 30.3% |
| Consumer discretionary | 245 | 4.0% | Luxexperience B.V 45.2% |
| Communication services | 83 | 3.7% | Uniti Group 58.4% |
What the numbers can and cannot tell you
Technology and healthcare usually sit near the top: software has almost no cost of goods, and patented drugs carry pricing power. Retail, distribution and staffing sit near the bottom — their business is moving large volumes at thin spreads, so a low margin is the model, not a failure. Comparing a distributor's 1% with a software company's 30% says more about the industries than about management.
Banks and insurers are a special case. Their "revenue" tag in XBRL is not the same economic quantity as a manufacturer's sales, and net margin for a bank is closer to a return-on-revenue figure than a product margin. Treat the financials row as a number on its own scale.
The top company in each sector is shown for context, not as a recommendation. High margins invite competition; a margin that is unusually high for its sector is as often a question as an answer.
One more caution about the year. Net income includes one-off items — an asset sale, a tax settlement, a write-down — so a single year's margin can be far from a company's normal level. The company pages show ten years of net income next to revenue; a margin that holds up across the series means more than a margin that appears once.
Source: each company's annual filing with the U.S. Securities and Exchange Commission (10-K, 20-F or 40-F), read through the XBRL data the company itself tagged. Sector assignment follows the SIC code on the filing. Foreign issuers reporting in other currencies are converted at ECB reference rates; margins are ratios and unaffected by the conversion.