When the
U.
S.
dollar is weak, this pads profits for U.S.-based companies with big operations overseas, such as Coca-Cola or McDonald's. A Big Mac in France always is
charged in euros, so
revenue doesn't
change based on
currency fluctuations. But when McDonald's reports
earnings in dollars, a
euro translates into more, providing a boost to overall revenue and profits. For non-U.S. companies with operations in the States, the earnings
impact is reversed. Say Sony sells a $1,000 Trinitron TV in the U.S. When the
company converts the
transaction from dollars into yen, it comes to about ?105,000. That's less than it would've been two years ago. Back then, the same $1,000 TV amounted to
sold for roughly ?125,000. (from November 2004)
This content can be found on the following page:
email
