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Ranked: U.S. Industries Where Companies Are Least Profitable

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1 month ago

February 10, 2025

Pallavi Rao

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Ranked: U.S. Industries With the Lowest Profit Margins

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Trade wars, AI battles, and real-world conflicts—it’s only February, but 2025 is shaping up to favor the bears over the bulls.

But even before these new disruptions, some sectors were already struggling.

This chart ranks U.S. industries by the lowest average net profit margins in 2024. Data is sourced from Damodaran Online, a database maintained by Aswath Damodaran, faculty at the NYU Stern School of Business.

ℹ️ Average net margins are calculated off cumulative net income and sales from each publicly traded company in the industry in the past 12 months. Data last updated in January 2025. Please see the source’s methodology page for more background information.

U.S. Green Energy Isn’t Making Greenbacks Yet

U.S. companies in the broader green energy industry tend to lose money, with an average net margin of -19% in 2024.

Rank	Industry	Average Net Margin	Example Firms	# of Publicly-Traded U.S. firms
1	Green & Renewable Energy	-18.8%	Brookfield Renewable Corporation / HNO International	18
2	Consumer Electronics	-15.4%	Sonos / GoPro	11
3	Biotechnology	-13.2%	Alnylam Pharmaceuticals / Natera	535
4	Broadcasting	-5.6%	iHeartMedia / Paramount Global	22
5	Precious Metals	-4.8%	Aura Minerals / i-80 Gold Corp	60
6	Entertainment	-3.2%	Roblox / Take-Two Interactive	96
7	Internet Software	-2.6%	Snowflake / Twilio	29
8	Rubber & Tires	-1.7%	Goodyear Tire / Ameridge Corp	3
9	Real Estate Operations	-0.8%	Compass Inc / Zillow	60
10	Diversified Chemicals	-0.5%	Huntsman Corp / The Chemours Company	4
11	Recreation	0.7%	Peloton / Vail Resorts	50
12	Office Equipment & Services	1.1%	MSA Safety / MillerKnoll	14
13	Food Wholesalers	1.3%	Sysco / US Foods Holding	14
14	Special Lines Retail	1.5%	Ross Stores / Best Buy	98
15	Healthcare Support Services	1.6%	UnitedHealth Group / CVS Health	113
16	Grocery & Food	2.0%	Kroger / Casey's General Stores	17
17	Furniture / Home Furnishings	2.1%	Whirlpool / La-Z-Boy Incorporated	28
18	Airlines	2.2%	Delta / United	24
19	Publishing & Newspapers	2.3%	New York Times / Scholastic	19
20	Auto Parts	2.3%	Lear Corporation / Gentex Corporation	33
21	Electrical Equipment	2.6%	Emerson Electric / GE Vernova	101
22	Education	2.7%	Duolingo / Udemy	29
23	Basic Chemicals	2.8%	Dow Inc. / Westlake Corporation	31
24	Engineering & Construction	3.0%	Quanta Services / EMCOR Group	42
25	Apparel	3.0%	Ralph Lauren / Levi Strauss	37
26	Advertising	3.0%	The Trade Desk / Omnicom Group	54
27	Oilfield Services & Equipment	3.3%	Schlumberger / Marathon Petroleum Corporation	97
28	Reinsurance	3.3%	Reinsurance Group of America	1
29	Automotive Retail	3.3%	O'Reilly Automotive / AutoZone	29
30	Auto & Truck	3.8%	Rivian / Life Electric Vehicles Holdings	34

Note: To see how companies are categorized, download this file which lists company name, SIC code, and related industry grouping.

With the demand for clean energy only increasing, it seems counterintuitive for companies to be struggling. As it happens, it’s mainly a macroeconomic problem.

Alternative energy companies face high upfront costs paired with long-term cash flows.

This becomes a significant issue as higher interest rates make it harder to finance projects that were initiated during periods of lower rates. Thus, the recent years of climbing interest rates have been particularly brutal for the sector.

Other Industries That Struggle to Make a Profit

Biotechnology is a surprising entry on this list, despite being a subsector of the larger pharmaceutical industry.

In fact, Big Pharma is known for big profits—often to the frustration of Americans who depend on its medications—so an average negative net margin stands out.

However, not all pharma companies operate the same way. This category includes smaller firms like Natera (DNA testing) and Galectin Therapeutics (cancer treatment). Additionally, with over 500 publicly listed companies, biotech has the most firms of any industry in the dataset.

Learn More on the Voronoi App

So…what industries are on the other end of the spectrum? Take a look through Ranked: U.S. Industries Where Companies Are Most Profitable for more insights.