Last year saw spectacular revenue figures for the world's largest firms, with a handful of Pennsylvania firms among them.

Total revenue for the Global 100 increased a vigorous 8.1% over the past year, a step up from 2017's already robust 6.7% growth and a showing that dwarfs the 2.8% and 3.1% growth from the two preceding years. These firms brought in a collective $114.2 billion, more than the 2018 gross domestic product of Ecuador, the 60th largest economy in the world.

And among those Pennsylvania firms that made the list both this year and last year—Morgan, Lewis & Bockius, Reed Smith, Dechert, K&L Gates, Fox Rothschild and Duane Morris—total revenue increased by 4.9%, from about $6 billion in 2017 to $6.3 billion in 2018.

However, each of those aforementioned Pennsylvania firms fell slightly in the rankings this year, with the exception of Fox Rothschild, which moved up to No. 92 from 95.

Meanwhile, two other Philadelphia-based firms, Blank Rome and Drinker Biddle & Reath, slipped off the Global 100 entirely this year, while Cozen O'Connor made the list for the first time, coming in at No. 100 with gross revenue of $473 million.

A total of 46 firms cracked the $1 billion mark this year, up from 34 firms two years ago. Among them were Morgan Lewis, Reed Smith, Dechert and K&L Gates. Of those 46 billion-dollar firms, all but nine have the bulk of their attorneys in the United States. Consequently, the American market continues to exert a heavy influence on the wider numbers. (The Am Law 100 posted 8% revenue growth in 2018.) Operating in an economy juiced by over $1 trillion in tax cuts, the U.S. giants reaped the benefits.

"In the U.S., the market was stunning," says Jomati Consultants principal Tony Williams, the former ­managing partner at Clifford Chance. "Even when you look at non-U.S. and non-China figures, it was mid-single digits overall. That's perfectly respectable."

Globally, most key practice areas were subject to brisk demand. The merger and acquisitions environment was active, albeit stronger in some markets than others. Disputes work, particularly international litigation and ­arbitration, kept practitioners busy. And an anticipated dip in investigations did not materialize, with sanctions, the Foreign ­Corrupt Practices Act and money laundering matters dotting the headlines.

Even the mild market correction at the end of 2018 had a muted impact.

"That did affect firms with a March or April year-end a bit more. But for U.S. firms, that's mostly done by the end of November," Williams says of how firms account for their results.

Credit: Kevin Fales

Other factors, beyond growing demand, also helped boost the numbers. Take mergers, for example. There were two significant mergers last year between U.S.-based firms and two significant trans-Atlantic mergers: Nelson Mullins Riley & Scarborough's combination with Broad and Cassel and Hunton & Williams' merger with Andrews Kurth Kenyon on the domestic side, and the creation of Womble Bond Dickinson and Bryan Cave Leighton Paisner internationally. Nelson Mullins and Womble Bond's moves pushed two smaller firms off this year's Global 100, and Hunton Andrews Kurth and Bryan Cave posted significantly higher revenues than their predecessors, which made the list last year. These changes helped account for a notable part of the overall revenue growth among this year's group.

Growth in China also played a role in making the 2018 numbers look particularly healthy.

Two large Chinese firms vaulted onto the Global 100 for the first time last year, and their presence, combined with significant China growth at Dentons, helped suppress the aggregate figure for revenue per lawyer, which actually declined 3.2% in 2017. That same metric rose by 2.7% in 2018. And it did so in part because of impressive growth at those two firms in particular. The Zhong Lun Law Firm, with 1,680 lawyers, almost doubled revenue per lawyer, from $264,000 to $508,000. Yingke, whose $82,000 RPL is much lower, still grew by nearly 37%. Along with China's AllBright Law Offices, a newcomer to the Global 100, those firms were in the top six in total revenue growth, with Yingke rising at an incredible 40%, AllBright growing 24.6% and Zhong Lun growing 18.7%.

In addition to Blank Rome and Drinker Biddle, two other firms dropped off the 2019 list: Chicago-based Jenner & Block and Australia's Allens, which burst onto the scene to rank 81st last year before bouncing out after just one year.

That left just one Australian firm, Ashurst, in the Global 100. Firms with more of their lawyers in the U.S. than any other jurisdiction held 77 of the spots, followed by the U.K., with 12. China's five firms include its three fast growers, as well as international players Dentons and King & Wood Mallesons, which The American Lawyer categorizes as Chinese firms. Canada placed four firms on this year's list, and South Korea is represented by Kim & Chang.

The very top of the Global 100, ranked by revenue, demonstrated ­remarkable stability in the past year. The largest eight firms were unchanged, and the only movement in the top 10 was in the ninth position, where Linklaters returned after a year out, displacing Hogan Lovells, which fell to 11th.

The biggest growth wasn't all found in China. While the country was home to three of the 10 fastest-growing firms on the list, the U.S. was home to six, led by Nelson Mullins' 27.5% jump and Foley & Lardner's 21.9% growth. The indomitable Kirkland & Ellis and Covington & Burling both exceeded 18% revenue growth, and Lewis Brisbois Bisgaard & Smith climbed 17.2%.

Meanwhile, only two firms on the list, Morrison & Foerster and Baker Botts, showed declining revenue—both of which were already reported in this year's Am Law 100.

If there's any cause for concern out of this year's figures, it's the fact that revenue per lawyer grew at a lower rate than the other key indicators—average profits per equity partner grew 4.6% to reach more than $1.7 million, for example. Meanwhile, wage and bonus costs are surging in a number of markets, not just the United States.

"There's some concern going forward that much of the increase in revenue was in increased head count rather than massively increased productivity," Williams says. "With costs up, you wouldn't need to have much of a dip to have an impact on the bottom line."

With whispers of a dreaded recession growing louder in recent months, thanks to political upheaval and uncertainty in London and Hong Kong, along with the burgeoning trade war between the U.S. and China, that's a good reminder for law firm leaders across the world. Get the house in order while the good times continue. It'll be easier to think carefully about what needs to be done now, rather than when the place is on fire.