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2021 CEO Survey
Mid-Market Companies
Profitability was Elusive for Many
Despite their best efforts, including adjusting their financial expectations and taking actions to address the challenging business environment, more than half of our CEOs saw their profits decline in 2020. Once again, those in the technology sector reported somewhat better results but businesses depending on a reliable supply chain, like those in manufacturing and construction, have not fared as well.
- 55% of companies surveyed reported a decline in profits (EBITDA) while only 25% reported an increase.
- More than half of technology companies surveyed reported that their profits grew.
- For companies that experienced a bottom line decline, 70% of those CEOs reported negative impacts to their supply chain due to the pandemic.
- Almost half (41%) of businesses that had a bottom line decline also reported experiencing operational challenges.
- Only 8% of manufacturing companies grew their profits and none of the construction companies who took part in our survey reported increased profitability.
41%
of businesses surveyed reported operational changes
EBITDA Profits
55%
DECLINED
25%
INCREASED
HALF of the companies in the technology sector GREW their profits
8%
of manufacturing companies grew their profits during COVID. None of the surveyed CONSTRUCTION companies reported increased profitability
70%
of CEOs experienced negative supply chain impacts during COVID
Newport Insight
Economic Impacts
The mixed profitability results revealed by our survey are consistent with what we’ve observed over the course of the pandemic – some businesses were simply better positioned to operate in the pandemic environment. Online retail, technology providers and platforms, and streaming entertainment services are examples of three business types that thrived while others struggled. More than half of companies surveyed reported a decline in profits with 70% of those companies experiencing COVID-19 related negative supply chain impacts. More than half of companies with a decline in profits reported being operationally worse due to pandemic impacts. CEOs at companies reporting a decline in profits listed their highest priorities as revenue growth, customer experience, and employee wellness (in priority order). Clearly, the pandemic conditions gave rise to a broad set of operational challenges and CEOs’ top priority of growth rests largely on solving supply chain related issues.
Michael Evans
Managing Director, San Francisco, CA
How Newport can help
Newport is a strategic business advisory firm, working with founders and CEOs of privately held, growth-stage companies to accelerate growth, improve performance, and successfully exit their businesses.
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