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Thursday, June 28, 2018

Corporate Pre-Tax Profits Revised Sharply Higher

Pre-tax profits are revised sharply higher for the first quarter, leading in turn to a sizable upward revision to after-tax corporate profits which are now at 2.7 percent year-on-year growth from the initial 0.1 percent rise.

Looking first at readings that exclude inventory valuation and capital consumption adjustments, pre-tax profits came in at an annualized $2.191 trillion which is up $51 billion from the initial estimate. After-tax profits are now at a $1.859 trillion annualized rate and, when compared against the $1.811 trillion rate in first-quarter last year makes for a 2.7 percent year-on-year gain.

When including inventory and capital adjustments, pretax profits were $2.252 trillion with after-tax profits at $1.920 trillion for 1.8 percent year-on-year growth and making for an annualized corporate income tax rate of $332.1 billion. This tax rate is up $3.9 billion from the first estimate and down substantially from $445.6 billion in the fourth quarter for the lowest rate of the expansion, since third-quarter 2009.

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