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The 50 Most Innovative Companies 2010

Before the world shuddered two years ago, U.S. companies dominated our Most Innovative Companies ranking, easily outnumbering corporations based outside of America. But now that the global economy seems to be growing again, senior executives surveyed by the Boston Consulting Group (BCG) no longer consider the U.S. the be-all and end-all in innovation. Yes, Apple reigns as No. 1 again, trailed by silver medalist Google. And Microsoft and IBM find themselves back in the top five, based on BCG's global poll. But for the first time ever, more companies on our Top 50 are based outside the U.S. China's rise is the fastest. A year ago, its only representative was Lenovo, at 46. This year Greater China is tied with Asia's postwar powerhouse, Japan, thanks to showings by BYD (8), Haier Electronics (27), Lenovo (29), China Mobile (44), and Taiwan-based HTC (47). To make room for 2010's freshmen, a half-dozen American giants on 2009's list got dumped: AT&T, ExxonMobil, 3M, Johnson & Johnson, Southwest Airlines, and Target. For more details on the ranking, see the footnotes at the bottom of the table.

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FOOTNOTES

Data: Analysis and data provided in collaboration with the Boston Consulting Group's innovation practice and BCG-ValueScience. Reuters and Standard & Poor's Compustat supplied financial data; Bloomberg provided total shareholder returns.

* Stock returns are annualized, Dec. 31, 2006, to Dec. 31, 2009, and account for price appreciation and dividends.

** Revenue and operating margin growth are annualized based on 2006-2009 fiscal years. Margin growth is earnings before interest and taxes as a percentage of revenues. Where possible, quarterly and semiannual data are used to bring performance for pre-June yearends closer to December 2009. Financial figures are calculated in local currency.

*** Calculating three-year compound annual growth rates for operating margins is not possible when the starting or end figure is negative.

NR: Not ranked in 2009 survey.