Does technology redefine sovereignty? Companies' profits approaching budgets of countries like Iraq

What does it mean for companies to generate revenues and profits in a year that exceed what entire national governments collect? That question was posed by a report that discussed the disparity between the vast resources of technology companies and traditional international sovereignty.

It mentioned The report that Nvidia recorded nearly $60 billion in profits in the early months of 2026, "meaning it could record total profits of $240 billion over a year." In contrast, it pointed out that Iraq possesses one of the world's largest oil reserves and an annual budget of $100 billion.

The report said that Nvidia "is not a state: it has no land, people, army, flag, or seat at the United Nations; it is an American technology company known for designing advanced computer chips that power the artificial intelligence revolution."

It added that Nvidia is only one of a small group of American tech giants whose profits approach the size of national budgets and economies, naming several companies including SpaceX, Microsoft, Apple, Google, Amazon and Meta, noting that together these companies are heading toward hundreds of billions of dollars in annual profits approaching a trillion dollars.

The report asked what this shift means when private companies can generate annual revenues and profits that exceed governments, and it explored the implications for the meaning of sovereignty when new forms of power fall outside direct state control.

It explained that power traditionally rested on control of territory, leadership of populations, and maintaining armies, and that the Peace of Westphalia in 1648 made the nation-state the dominant political unit because it could marshal resources on a scale individuals and private companies could not. But it noted that this model appears to be eroding as states increasingly rely on companies to exercise some aspects of power.

The report pointed out that major tech companies operate infrastructure spanning continents, control platforms used by billions, hold capital rivaling state resources, and control the technologies modern economies and militaries depend on. But it cautioned that technological dependence does not necessarily mean loss of sovereignty.

The report quoted Hassan Al-Khatib, who served as adviser to the Iraqi prime minister for digital transformation and telecommunications from 2023 to 2026, saying "No contemporary country can be technologically self-sufficient," and that the more useful concept is "digital sovereignty," meaning "the ability of the state to retain control, choice and flexibility over the digital systems its government, economy and national security rely on."

It added that the digital sector includes data, communications, computing infrastructure, digital identity, cybersecurity and artificial intelligence, and that this new infrastructure has a concrete effect on Iraq's geopolitics. It gave the example of a telecom company that built Silk Route Transit, a fiber-optic terrestrial cable network carrying data from the Gulf to Europe — a 21st-century version of the telegraph lines that linked empires in the past.

But the report quoted Al-Khatib also saying "Geography alone does not create digital sovereignty," and that the value of fiber-optic cables crossing Iraqi territory depends on who owns and operates the infrastructure, where data is processed, who controls the network and which legal jurisdictions govern it. He said: "If done correctly, Iraq's emergence as a data transit country can enhance rather than weaken its sovereignty."

The report linked the current situation to a semi-historical example in which the East India Company began as a commercial enterprise then owned an army, controlled territories, governed populations, collected taxes and exercised quasi-sovereign powers; it said some current tech companies have accumulated capabilities once almost exclusively associated with states.

It pointed to practical examples, such as the Starlink network that played a role in modern warfare and communications in Ukraine, and that launch capabilities give a space company unusual access to space. It added that combining technologies like artificial intelligence, satellite communications and social media can affect electoral outcomes and concentrate vast powers in the hands of individuals or companies.

However the report quoted Al-Khatib warning against conflating influence with sovereignty, saying: "There is no doubt this gives these companies significant influence, but influence should not automatically be interpreted as sovereignty; the crucial question is whether the state has alternatives."

The report noted that much of the discourse about Iraq still focuses on Iran-backed militias and American strategic interests, overshadowing developments that Iraqi companies are helping to build infrastructure that places Iraq within the global digital economy. It added that cybercrime threatens trade, critical infrastructure and political institutions, and that digital vulnerabilities expose key sectors.

It said Iraq has responded by making cybersecurity a national security issue and by strengthening its institutional capacity to confront it, and that this creates a central paradox: "Iraq is sovereign, but sovereignty does not mean technological self-sufficiency"; the state may control its borders yet remain vulnerable to attacks on the networks that sustain electricity, communications, health systems and the economy.

The report concluded by stressing that the nation-state is not disappearing — it still has the legal authority to regulate or break up companies — but governments increasingly need the companies they are supposed to regulate. It argued that states may have to share the stage with companies that control the infrastructure through which power is exercised, concluding that "technology is redefining the concept of sovereignty, but it does not abolish it."