The biggest company losses of all time
Daniel Coughlin
18 June 2019
The most catastrophic corporate annual liabilities ever
Sliding into the red spectacularly, some of the world's prominent firms have posted colossal yearly shortfalls that eclipse the GDPs of entire countries. Adjusting the figures for inflation, we reveal the 30 most extreme company losses of all time.
IBM, 1992: $14.2 billion (£11.2bn)
IBM was rocked by the PC and client/server revolutions of the 1980s and early 1990s, which upset the American IT giant's client relationships and pummelled its bottom line. The drama culminated in 1992 with a loss which, when adjusted for 2019 dollars, is equivalent to the GDP of Brunei. Pictured here is the CEO at the time, Louis V. Gerstner.
Swiss National Bank, 2018: $15.2 billion (£12bn)
The special statute joint-stock company that acts as Switzerland's central bank has gone from one extreme to another in terms of its financial health. After reporting a record profit in 2017, the institution posted a record loss in 2018. The culprits? A stronger Swiss franc and weakening equity markets, which have hit the bank especially hard.
Ford, 2006: $16.1 billion (£12.7bn)
Plagued by intensifying competition, flagging sales and immense restructuring costs, Ford posted a huge loss for 2006, equivalent to the GDP of Jamaica or a hefty $1,925 (£1.5k) for every vehicle the American automaker sold that year.
Tepco, 2011: $16.8 billion (£13.2bn)
Japan's Tepco operated the Fukushima Daiichi Nuclear Power Plant in Okuma, which was severely damaged in March 2011 following the devastating Tohoku earthquake and tsunami, precipitating one of the world's worst-ever nuclear disasters. Needless to say, the calamity battered the energy company's finances.
Ford, 2008: $17.3 billion (£13.6bn)
After posting what was then the worst loss in its 103-year history, struggling Ford recorded an even more painful shortfall in 2008. Amid the global financial crisis, the Dearborn-based company saw its sales slip by 20% and had to go cap in hand to the US government in 2009 to secure a substantial bailout loan.
E.ON, 2016: $18.1 billion (£14.2bn)
Excessive operating costs, an enormous restructuring bill and a glut of electricity combined with an overvaluation of its fossil fuels division plunged E.ON's finances into negative territory in 2016. The German utility company ended the year severely out of pocket. CEO Johannes Teyssen is pictured here delivering the bad news.
UBS, 2008: $20.2 billion (£15.9bn)
The credit crunch that kicked off the global economic crisis proved to be a nightmare for investment bank UBS. The financial institution reported the worst loss in Swiss corporate history in 2008. As a result, UBS was forced to shed thousands of jobs.
Anglo Irish Bank, 2009: $22.8 billion (£17.4bn)
Another victim of (or contributor to) the global financial crisis, in 2009 Anglo Irish Bank posted the largest loss in Ireland's corporate history. The shortfall spelled the end for the organisation. It was nationalised and wound down that same year and merged with the Irish Nationwide Building Society in 2011.
mmO2, 2002: $24.4 billion (£19.2bn)
After a humongous write-down on the value of its assets, Britain's mmO2, the BT Group's demerged mobile phone company that was later acquired by Spanish provider Telefónica, recorded a huge loss for 2002. The bulk of the write-downs were related to its purchase of 3G licences.
Nakheel, 2009: $24.9 billion (£19.6bn)
When Dubai's property market came crashing down in 2009, the emirate's number one developer took a particularly damaging hit. Adjusted for inflation, the loss is equivalent to the GDP of Cyprus.
United Airlines, 2005: $27.7 billion (£21.8bn)
UAL Corp., the parent company of America's United Airlines, was in deep trouble in 2005. Rising fuel costs ate into its bottom line, and by the end of the year, the firm, which was in Chapter 11 bankruptcy and had defaulted on its pension plans, reported a massive annual loss.
Bankia, 2012: $27.8 billion (£21.9bn)
In 2012, Spanish lender Bankia found itself at the centre of the country's financial crisis. The popping of the Spanish property bubble and plethora of mortgage defaults that followed translated to the worst annual liabilities in Spain's corporate history.
Vodafone, 2002: $27.8 billion (£21.9bn)
Telecoms giant Vodafone splurged on a number of companies during the dotcom boom of the late 1990s, but by the early 2000s these businesses weren't worth the money the British firm paid for them. As a consequence, in 2002 Vodafone posted the highest annual loss in UK corporate history up until that point.
France Télécom, 2002: $29.7 billion (£23.4bn)
Staying with telecommunications companies, France Télécom, which was rebranded as Orange in 2013, went on a similar spending spree in the late 1990s. When the dotcom bubble burst, its share price nosedived and by 2002 it was the world's second most indebted firm.
Freddie Mac, 2009: $30.6 billion (£24.1bn)
The Federal Home Loan Mortgage Corporation (FHLMC), which is better known as Freddie Mac, was one of the organisations that fuelled America's subprime mortgage crisis. In 2008, it was famously bailed out by the federal government at immense cost to taxpayers. A year later, it posted huge losses.
Vivendi Universal, 2002: $32.8 billion (£25.8bn)
In 2002, France's Vivendi Universal, which was at the time the world's second biggest media company, reported the worst liabilities in French corporate history. The gaping hole in its finances was caused by a drastic write-down of assets acquired during the dotcom boom by disgraced former CEO Jean-Marie Messier.
Citigroup, 2008: $32.9 billion (£25.9bn)
Like Freddie Mac, Citigroup came unstuck during the subprime mortgage crisis of 2008 and had to be bailed out by the US government – basically the American taxpayer – for a stomach-churning $476.2 billion (£374.4bn).
Vodafone, 2006: $35.4 billion (£27.8bn)
Vodafone posted yet another enormous loss in 2006. The British telecommunications company was forced to write down the value of Mannesmann, the German firm it bought in 2000 at the end of the dotcom boom. All in all, Vodafone's shortfall for 2006 was the largest in European corporate history at that time.
General Motors, 2008: $36.7 billion (£28.9bn)
Mirroring the situation at Ford, General Motors was on the brink in 2008 as sales slumped during the global financial crisis. Like its Dearborn-based competitor, the venerable auto manufacturer had to resort to taking out government loans to stay afloat.
Deutsche Telekom, 2002: $38.5 billion (£30.3bn)
In 2002, Deutsche Telekom found itself in the same boat as Vodafone, France Télécom and Vivendi Universal – the assets it snapped up during the dotcom boom were massively written down, leading to the largest annual liabilities in German corporate history.
Royal Bank of Scotland, 2008: $40.6 billion (£31.9bn)
Yet another financial institution that found itself on its knees during the global financial crisis, the Royal Bank of Scotland posted the biggest loss in British corporate history in 2008 and the equivalent of Tunisia's GDP. The bank ended up receiving a bailout from the UK government, costing taxpayers in the country dear.
General Motors, 1992: $42.8 billion (£33.7bn)
No stranger to gargantuan shortfalls, the US automaker posted end of year liabilities for 1992 which, at the time, was the largest corporate loss in history. The deficit was due to costly restructuring and accounting rule changes applied to the firm's healthcare obligations to retirees.
General Motors, 2007: $47.7 billion (£37.5bn)
In 2007, the ailing carmaker reported its most abysmal shortfall ever. Crippled by lacklustre sales around the world, the Detroit-headquartered firm almost went under.
Qwest, 2002: $51 billion (£40.1bn)
Beset by problems in many aspects of its business, the now-defunct Qwest Communications posted a record-breaking loss for 2002. The US telecommunications firm, which was swallowed up by CenturyLink in 2011, was investigated for accounting fraud not long after.
Freddie Mac, 2008: $60.3 billion (£47.4bn)
Freddie Mac was, as we've mentioned, bailed out by the US government in 2008 when its business based on buying subprime and other mortgages from banks and packaging them into mortgage-backed securities became unsustainable, punching a gaping hole in the organisation's finances.
Fannie Mae, 2008: $71 billion (£55.8bn)
Freddie Mac's sister company, the Federal National Mortgage Association (FNMA) aka Fannie Mae, which operated in much the same way buying subprime and other mortgages from banks, also failed big time in 2008 and had to be bailed out by the federal government. When adjusted for inflation, the figure of $71 billion (£55.8bn) equates to the GDP of affluent Luxembourg.
JDS Uniphase, 2001: $81 billion (£63.7bn)
JDS Uniphase, a US firm that produced optical and communications products, ended the 2001 fiscal year on a sour note, having lost an eye-watering amount. The company, which was split into two different entities in 2015, put the shortfall down to writing off a series of bad investments.
Fannie Mae, 2009: $88.6 billion (£69.7bn)
Back to good old Fannie Mae. A year after its subprime mortgage debacle and the mega government bailout that stung US taxpayers in a major way, the financial institution posted a gargantuan annual loss, which when converted to 2019 dollars is equivalent to the GDP of Kenya.
American International Group (AIG), 2008: $117.9 billion (£92.7bn)
At the height of the global financial crisis in 2008, American insurance titan AIG faced collapse when the value of its credit default swaps, which were tied to subprime mortgages, plummeted and the firm's securities lending business tanked. AIG was saved by a bailout from the Federal Reserve Bank of New York.
AOL Time Warner, 2002: $140.2 billion (£110.3bn)
The company that posted the biggest annual loss of all time, AOL Time Warner reported liabilities amounting to a staggering $140.2 billion (£110bn) in today's money. This is equivalent to the inflation-adjusted GDP of oil-rich Kuwait. The loss came about as a result of a change in accounting rules and significant write-down on the value of AOL, which was in bad shape at the time.
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