Return on Capital (ROC)
Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company debt and equity structure. It measures business productivity performance.
Return on Invested Capital (ROIC)
Monolithic Power Systems Inc., ROIC calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net operating profit after taxes (NOPAT)1 | 409,452) | 416,610) | 248,394) | 160,282) | 99,197) | |
| Invested capital2 | 1,475,541) | 1,231,421) | 683,433) | 635,280) | 460,591) | |
| Performance Ratio | ||||||
| ROIC3 | 27.75% | 33.83% | 36.35% | 25.23% | 21.54% | |
| Benchmarks | ||||||
| ROIC, Competitors4 | ||||||
| Advanced Micro Devices Inc. | -0.35% | -0.24% | 56.77% | 30.47% | — | |
| Analog Devices Inc. | 7.11% | 5.76% | 2.37% | 6.95% | 8.23% | |
| Applied Materials Inc. | 36.75% | 46.34% | 41.96% | 29.68% | 28.97% | |
| Broadcom Inc. | 23.04% | 20.76% | 11.02% | 4.80% | 5.00% | |
| Intel Corp. | -1.60% | 4.14% | 22.03% | 28.01% | — | |
| KLA Corp. | 40.63% | 42.51% | 31.64% | 19.88% | 20.98% | |
| Lam Research Corp. | 27.10% | 41.68% | 37.13% | 20.36% | 16.31% | |
| Micron Technology Inc. | -11.01% | 17.20% | 12.88% | 6.84% | 17.15% | |
| NVIDIA Corp. | 10.91% | 53.12% | 33.44% | 19.63% | 80.01% | |
| Qualcomm Inc. | 18.69% | 45.12% | 42.56% | 27.48% | 28.27% | |
| Texas Instruments Inc. | 28.83% | 49.74% | 48.28% | 43.48% | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 NOPAT. See details »
2 Invested capital. See details »
3 2023 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 409,452 ÷ 1,475,541 = 27.75%
4 Click competitor name to see calculations.
| Performance ratio | Description | The company |
|---|---|---|
| ROIC | A measure of the periodic, after tax, cash-on-cash yield earned in the business. | Monolithic Power Systems Inc. ROIC deteriorated from 2021 to 2022 and from 2022 to 2023. |
Decomposition of ROIC
Monolithic Power Systems Inc., decomposition of ROIC
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Operating profit margin (OPM). See calculations »
2 Turnover of capital (TO). See calculations »
3 Effective cash tax rate (CTR). See calculations »
The primary reason for the decrease in return on invested capital (ROIC) over 2023 year is the decrease in efficiency measured by turnover of capital (TO) ratio.
Operating Profit Margin (OPM)
Monolithic Power Systems Inc., OPM calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net operating profit after taxes (NOPAT)1 | 409,452) | 416,610) | 248,394) | 160,282) | 99,197) | |
| Add: Cash operating taxes2 | 66,188) | 97,226) | 26,365) | 4,486) | 3,279) | |
| Net operating profit before taxes (NOPBT) | 475,639) | 513,837) | 274,759) | 164,768) | 102,476) | |
| Revenue | 1,821,072) | 1,794,148) | 1,207,798) | 844,452) | 627,921) | |
| Profitability Ratio | ||||||
| OPM3 | 26.12% | 28.64% | 22.75% | 19.51% | 16.32% | |
| Benchmarks | ||||||
| OPM, Competitors4 | ||||||
| Advanced Micro Devices Inc. | 2.02% | 5.31% | 22.70% | 13.87% | — | |
| Analog Devices Inc. | 32.00% | 27.59% | 20.52% | 26.98% | 29.60% | |
| Applied Materials Inc. | 29.22% | 30.32% | 30.54% | 25.67% | 23.94% | |
| Broadcom Inc. | 45.19% | 42.94% | 31.06% | 17.10% | 15.65% | |
| Intel Corp. | -0.86% | 13.58% | 28.05% | 32.68% | — | |
| KLA Corp. | 39.78% | 41.73% | 36.39% | 26.09% | 32.80% | |
| Lam Research Corp. | 28.38% | 35.59% | 34.25% | 27.26% | 20.46% | |
| Micron Technology Inc. | -36.77% | 31.50% | 23.15% | 14.37% | 29.89% | |
| NVIDIA Corp. | 15.97% | 37.99% | 28.45% | 26.65% | 33.15% | |
| Qualcomm Inc. | 21.48% | 35.06% | 30.10% | 24.17% | 29.86% | |
| Texas Instruments Inc. | 44.51% | 51.22% | 49.60% | 43.13% | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2023 Calculation
OPM = 100 × NOPBT ÷ Revenue
= 100 × 475,639 ÷ 1,821,072 = 26.12%
4 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| OPM | The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. | Monolithic Power Systems Inc. OPM improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023. |
Turnover of Capital (TO)
Monolithic Power Systems Inc., TO calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | 1,821,072) | 1,794,148) | 1,207,798) | 844,452) | 627,921) | |
| Invested capital1 | 1,475,541) | 1,231,421) | 683,433) | 635,280) | 460,591) | |
| Efficiency Ratio | ||||||
| TO2 | 1.23 | 1.46 | 1.77 | 1.33 | 1.36 | |
| Benchmarks | ||||||
| TO, Competitors3 | ||||||
| Advanced Micro Devices Inc. | 0.39 | 0.40 | 2.65 | 2.24 | — | |
| Analog Devices Inc. | 0.28 | 0.27 | 0.16 | 0.31 | 0.33 | |
| Applied Materials Inc. | 1.49 | 1.73 | 1.57 | 1.31 | 1.44 | |
| Broadcom Inc. | 0.57 | 0.53 | 0.42 | 0.36 | 0.38 | |
| Intel Corp. | 0.59 | 0.71 | 0.89 | 0.95 | — | |
| KLA Corp. | 1.26 | 1.18 | 1.01 | 0.89 | 0.72 | |
| Lam Research Corp. | 1.14 | 1.35 | 1.24 | 0.86 | 0.93 | |
| Micron Technology Inc. | 0.29 | 0.58 | 0.60 | 0.51 | 0.60 | |
| NVIDIA Corp. | 1.26 | 1.49 | 1.28 | 0.77 | 2.45 | |
| Qualcomm Inc. | 1.14 | 1.50 | 1.66 | 1.33 | 1.13 | |
| Texas Instruments Inc. | 0.78 | 1.14 | 1.12 | 1.12 | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Invested capital. See details »
2 2023 Calculation
TO = Revenue ÷ Invested capital
= 1,821,072 ÷ 1,475,541 = 1.23
3 Click competitor name to see calculations.
| Efficiency ratio | Description | The company |
|---|---|---|
| TO | The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. | Monolithic Power Systems Inc. TO deteriorated from 2021 to 2022 and from 2022 to 2023. |
Effective Cash Tax Rate (CTR)
Monolithic Power Systems Inc., CTR calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net operating profit after taxes (NOPAT)1 | 409,452) | 416,610) | 248,394) | 160,282) | 99,197) | |
| Add: Cash operating taxes2 | 66,188) | 97,226) | 26,365) | 4,486) | 3,279) | |
| Net operating profit before taxes (NOPBT) | 475,639) | 513,837) | 274,759) | 164,768) | 102,476) | |
| Tax Rate | ||||||
| CTR3 | 13.92% | 18.92% | 9.60% | 2.72% | 3.20% | |
| Benchmarks | ||||||
| CTR, Competitors4 | ||||||
| Advanced Micro Devices Inc. | 143.92% | 111.01% | 5.73% | 1.76% | — | |
| Analog Devices Inc. | 20.23% | 21.73% | 25.70% | 16.31% | 14.82% | |
| Applied Materials Inc. | 15.68% | 11.76% | 12.33% | 12.01% | 16.10% | |
| Broadcom Inc. | 10.78% | 9.59% | 16.44% | 22.63% | 15.10% | |
| Intel Corp. | — | 57.13% | 12.07% | 9.78% | — | |
| KLA Corp. | 18.86% | 13.88% | 14.30% | 14.62% | 10.70% | |
| Lam Research Corp. | 16.15% | 13.55% | 12.57% | 13.09% | 14.26% | |
| Micron Technology Inc. | — | 6.38% | 6.96% | 6.13% | 4.94% | |
| NVIDIA Corp. | 45.94% | 6.28% | 8.10% | 4.59% | 1.47% | |
| Qualcomm Inc. | 23.51% | 14.27% | 14.84% | 14.19% | 16.37% | |
| Texas Instruments Inc. | 16.49% | 14.83% | 12.93% | 9.63% | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2023 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 66,188 ÷ 475,639 = 13.92%
4 Click competitor name to see calculations.
| Tax rate | Description | The company |
|---|---|---|
| CTR | Effective cash tax rate on operating income. | Monolithic Power Systems Inc. CTR increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level. |