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Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Economic Profit
Net Operating Profit after Taxes (NOPAT)
Cash Operating Taxes
Invested Capital
Cost of Capital
Economic Spread Ratio
Economic Profit Margin

NVIDIA Corp., economic profit calculation

US$ in millions

12 months ended:	Jan 26, 2025	Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Net operating profit after taxes (NOPAT)¹	68,707)	27,819)	2,334)	9,602)	4,425)	2,792)
Cost of capital²	22.09%	22.03%	21.77%	21.78%	21.66%	21.86%
Invested capital³	47,433)	31,144)	21,396)	18,075)	13,232)	14,224)

Economic profit⁴	58,229)	20,959)	(2,324)	5,665)	1,559)	(318)

Based on: 10-K (reporting date: 2025-01-26), 10-K (reporting date: 2024-01-28), 10-K (reporting date: 2023-01-29), 10-K (reporting date: 2022-01-30), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26).

¹ NOPAT. See details »

² Cost of capital. See details »

³ Invested capital. See details »

⁴ 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 68,707 – 22.09% × 47,433 = 58,229

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Item	Description	The company
Economic profit	Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital.	NVIDIA Corp. economic profit increased from 2023 to 2024 and from 2024 to 2025.

NVIDIA Corp., NOPAT calculation

US$ in millions

12 months ended:	Jan 26, 2025	Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Net income	72,880)	29,760)	4,368)	9,752)	4,332)	2,796)
Deferred income tax expense (benefit)¹	(4,477)	(2,489)	(2,164)	(406)	(282)	18)
Increase (decrease) in allowance for doubtful accounts²	—)	—)	—)	—)	2)	—)
Increase (decrease) in deferred revenue³	476)	765)	70)	51)	250)	63)
Increase (decrease) in accrual for product warranty liabilities⁴	984)	224)	36)	24)	7)	(3)
Increase (decrease) in equity equivalents⁵	(3,017)	(1,500)	(2,058)	(331)	(23)	78)
Interest expense	247)	257)	262)	236)	184)	52)
Interest expense, operating lease liability⁶	75)	51)	35)	22)	22)	22)
Adjusted interest expense	322)	308)	297)	258)	206)	74)
Tax benefit of interest expense⁷	(68)	(65)	(62)	(54)	(43)	(16)
Adjusted interest expense, after taxes⁸	255)	243)	234)	204)	162)	59)
(Gain) loss on marketable securities	—)	—)	1)	—)	(2)	—)
Interest income	(1,786)	(866)	(267)	(29)	(57)	(178)
Investment income, before taxes	(1,786)	(866)	(266)	(29)	(59)	(178)
Tax expense (benefit) of investment income⁹	375)	182)	56)	6)	12)	37)
Investment income, after taxes¹⁰	(1,411)	(684)	(210)	(23)	(47)	(141)
Net operating profit after taxes (NOPAT)	68,707)	27,819)	2,334)	9,602)	4,425)	2,792)

Based on: 10-K (reporting date: 2025-01-26), 10-K (reporting date: 2024-01-28), 10-K (reporting date: 2023-01-29), 10-K (reporting date: 2022-01-30), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26).

¹ Elimination of deferred tax expense. See details »

² Addition of increase (decrease) in allowance for doubtful accounts.

³ Addition of increase (decrease) in deferred revenue.

⁴ Addition of increase (decrease) in accrual for product warranty liabilities.

⁵ Addition of increase (decrease) in equity equivalents to net income.

⁶ 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 1,807 × 4.16% = 75

⁷ 2025 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 322 × 21.00% = 68

⁸ Addition of after taxes interest expense to net income.

⁹ 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 1,786 × 21.00% = 375

¹⁰ Elimination of after taxes investment income.

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Item	Description	The company
NOPAT	Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income.	NVIDIA Corp. NOPAT increased from 2023 to 2024 and from 2024 to 2025.

NVIDIA Corp., cash operating taxes calculation

US$ in millions

12 months ended:	Jan 26, 2025	Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Income tax expense (benefit)	11,146)	4,058)	(187)	189)	77)	174)
Less: Deferred income tax expense (benefit)	(4,477)	(2,489)	(2,164)	(406)	(282)	18)
Add: Tax savings from interest expense	68)	65)	62)	54)	43)	16)
Less: Tax imposed on investment income	375)	182)	56)	6)	12)	37)
Cash operating taxes	15,316)	6,430)	1,983)	643)	390)	134)

Based on: 10-K (reporting date: 2025-01-26), 10-K (reporting date: 2024-01-28), 10-K (reporting date: 2023-01-29), 10-K (reporting date: 2022-01-30), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26).

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Item	Description	The company
Cash operating taxes	Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction.	NVIDIA Corp. cash operating taxes increased from 2023 to 2024 and from 2024 to 2025.

NVIDIA Corp., invested capital calculation (financing approach)

US$ in millions

	Jan 26, 2025	Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Short-term debt	—)	1,250)	1,250)	—)	999)	—)
Long-term debt	8,463)	8,459)	9,703)	10,946)	5,964)	1,991)
Operating lease liability¹	1,807)	1,347)	1,078)	885)	755)	652)
Total reported debt & leases	10,270)	11,056)	12,031)	11,831)	7,718)	2,643)
Shareholders’ equity	79,327)	42,978)	22,101)	26,612)	16,893)	12,204)
Net deferred tax (assets) liabilities²	(10,093)	(5,617)	(3,148)	(976)	(565)	(519)
Allowance for doubtful accounts³	4)	4)	4)	4)	4)	2)
Deferred revenue⁴	1,813)	1,337)	572)	502)	451)	201)
Accrual for product warranty liabilities⁵	1,290)	306)	82)	46)	22)	15)
Equity equivalents⁶	(6,986)	(3,970)	(2,490)	(424)	(88)	(301)
Accumulated other comprehensive (income) loss, net of tax⁷	(28)	(27)	43)	11)	(19)	(1)
Adjusted shareholders’ equity	72,313)	38,981)	19,654)	26,199)	16,786)	11,902)
Construction in process⁸	(529)	(189)	(382)	(737)	(558)	(320)
Marketable securities⁹	(34,621)	(18,704)	(9,907)	(19,218)	(10,714)	(1)
Invested capital	47,433)	31,144)	21,396)	18,075)	13,232)	14,224)

Based on: 10-K (reporting date: 2025-01-26), 10-K (reporting date: 2024-01-28), 10-K (reporting date: 2023-01-29), 10-K (reporting date: 2022-01-30), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26).

¹ Addition of capitalized operating leases.

² Elimination of deferred taxes from assets and liabilities. See details »

³ Addition of allowance for doubtful accounts receivable.

⁴ Addition of deferred revenue.

⁵ Addition of accrual for product warranty liabilities.

⁶ Addition of equity equivalents to shareholders’ equity.

⁷ Removal of accumulated other comprehensive income.

⁸ Subtraction of construction in process.

⁹ Subtraction of marketable securities.

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Item	Description	The company
Invested capital	Capital is an approximation of the economic book value of all cash invested in going-concern business activities.	NVIDIA Corp. invested capital increased from 2023 to 2024 and from 2024 to 2025.

NVIDIA Corp., cost of capital calculations

Jan 26, 2025

	Capital (fair value)¹	Weights					Cost of capital
Equity²	3,203,232)	3,203,232)	÷	3,212,270)	=	1.00	1.00	×	22.14%	=	22.08%
Total debt³	7,231)	7,231)	÷	3,212,270)	=	0.00	0.00	×	2.92% × (1 – 21.00%)	=	0.01%
Operating lease liability⁴	1,807)	1,807)	÷	3,212,270)	=	0.00	0.00	×	4.16% × (1 – 21.00%)	=	0.00%
Total:	3,212,270)					1.00					22.09%

Based on: 10-K (reporting date: 2025-01-26).

¹ US$ in millions

² Equity. See details »

³ Total debt. See details »

⁴ Operating lease liability. See details »

Jan 28, 2024

	Capital (fair value)¹	Weights					Cost of capital
Equity²	1,686,750)	1,686,750)	÷	1,696,692)	=	0.99	0.99	×	22.14%	=	22.01%
Total debt³	8,595)	8,595)	÷	1,696,692)	=	0.01	0.01	×	2.63% × (1 – 21.00%)	=	0.01%
Operating lease liability⁴	1,347)	1,347)	÷	1,696,692)	=	0.00	0.00	×	3.76% × (1 – 21.00%)	=	0.00%
Total:	1,696,692)					1.00					22.03%

Based on: 10-K (reporting date: 2024-01-28).

¹ US$ in millions

² Equity. See details »

³ Total debt. See details »

⁴ Operating lease liability. See details »

Jan 29, 2023

	Capital (fair value)¹	Weights					Cost of capital
Equity²	575,263)	575,263)	÷	586,146)	=	0.98	0.98	×	22.14%	=	21.73%
Total debt³	9,805)	9,805)	÷	586,146)	=	0.02	0.02	×	2.38% × (1 – 21.00%)	=	0.03%
Operating lease liability⁴	1,078)	1,078)	÷	586,146)	=	0.00	0.00	×	3.21% × (1 – 21.00%)	=	0.00%
Total:	586,146)					1.00					21.77%

Based on: 10-K (reporting date: 2023-01-29).

¹ US$ in millions

² Equity. See details »

³ Total debt. See details »

⁴ Operating lease liability. See details »

Jan 30, 2022

	Capital (fair value)¹	Weights					Cost of capital
Equity²	663,895)	663,895)	÷	676,001)	=	0.98	0.98	×	22.14%	=	21.75%
Total debt³	11,221)	11,221)	÷	676,001)	=	0.02	0.02	×	2.38% × (1 – 21.00%)	=	0.03%
Operating lease liability⁴	885)	885)	÷	676,001)	=	0.00	0.00	×	2.51% × (1 – 21.00%)	=	0.00%
Total:	676,001)					1.00					21.78%

Based on: 10-K (reporting date: 2022-01-30).

¹ US$ in millions

² Equity. See details »

³ Total debt. See details »

⁴ Operating lease liability. See details »

Jan 31, 2021

	Capital (fair value)¹	Weights					Cost of capital
Equity²	340,256)	340,256)	÷	348,862)	=	0.98	0.98	×	22.14%	=	21.60%
Total debt³	7,851)	7,851)	÷	348,862)	=	0.02	0.02	×	3.22% × (1 – 21.00%)	=	0.06%
Operating lease liability⁴	755)	755)	÷	348,862)	=	0.00	0.00	×	2.87% × (1 – 21.00%)	=	0.00%
Total:	348,862)					1.00					21.66%

Based on: 10-K (reporting date: 2021-01-31).

¹ US$ in millions

² Equity. See details »

³ Total debt. See details »

⁴ Operating lease liability. See details »

Jan 26, 2020

	Capital (fair value)¹	Weights					Cost of capital
Equity²	188,986)	188,986)	÷	191,709)	=	0.99	0.99	×	22.14%	=	21.83%
Total debt³	2,071)	2,071)	÷	191,709)	=	0.01	0.01	×	2.86% × (1 – 21.00%)	=	0.02%
Operating lease liability⁴	652)	652)	÷	191,709)	=	0.00	0.00	×	3.45% × (1 – 21.00%)	=	0.01%
Total:	191,709)					1.00					21.86%

Based on: 10-K (reporting date: 2020-01-26).

¹ US$ in millions

² Equity. See details »

³ Total debt. See details »

⁴ Operating lease liability. See details »

NVIDIA Corp., economic spread ratio calculation, comparison to benchmarks

	Jan 26, 2025	Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Selected Financial Data (US$ in millions)
Economic profit¹	58,229)	20,959)	(2,324)	5,665)	1,559)	(318)
Invested capital²	47,433)	31,144)	21,396)	18,075)	13,232)	14,224)
Performance Ratio
Economic spread ratio³	122.76%	67.30%	-10.86%	31.34%	11.78%	-2.23%
Benchmarks
Economic Spread Ratio, Competitors⁴
Advanced Micro Devices Inc.	—	-20.36%	-21.78%	-21.48%	35.21%	8.97%
Analog Devices Inc.	—	-12.57%	-8.49%	-9.85%	-13.11%	-8.10%
Applied Materials Inc.	—	8.61%	16.51%	26.42%	21.93%	10.18%
Broadcom Inc.	—	-7.62%	7.60%	6.17%	-3.14%	-8.56%
Intel Corp.	—	-25.83%	-14.83%	-8.32%	8.73%	14.35%
KLA Corp.	—	19.35%	23.23%	25.54%	14.12%	3.06%
Lam Research Corp.	—	2.26%	7.57%	22.49%	17.85%	1.99%
Micron Technology Inc.	—	-15.64%	-27.69%	0.05%	-4.52%	-10.04%
Monolithic Power Systems Inc.	—	11.96%	12.68%	18.77%	21.28%	10.17%
Qualcomm Inc.	—	10.10%	2.54%	28.98%	26.38%	11.43%
Texas Instruments Inc.	—	5.44%	15.07%	35.72%	34.34%	29.48%

Based on: 10-K (reporting date: 2025-01-26), 10-K (reporting date: 2024-01-28), 10-K (reporting date: 2023-01-29), 10-K (reporting date: 2022-01-30), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26).

¹ Economic profit. See details »

² Invested capital. See details »

³ 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × 58,229 ÷ 47,433 = 122.76%

⁴ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic spread ratio	The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital.	NVIDIA Corp. economic spread ratio improved from 2023 to 2024 and from 2024 to 2025.

NVIDIA Corp., economic profit margin calculation, comparison to benchmarks

	Jan 26, 2025	Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Selected Financial Data (US$ in millions)
Economic profit¹	58,229)	20,959)	(2,324)	5,665)	1,559)	(318)

Revenue	130,497)	60,922)	26,974)	26,914)	16,675)	10,918)
Add: Increase (decrease) in deferred revenue	476)	765)	70)	51)	250)	63)
Adjusted revenue	130,973)	61,687)	27,044)	26,965)	16,925)	10,981)
Performance Ratio
Economic profit margin²	44.46%	33.98%	-8.59%	21.01%	9.21%	-2.89%
Benchmarks
Economic Profit Margin, Competitors³
Advanced Micro Devices Inc.	—	-45.98%	-55.60%	-53.25%	13.27%	4.01%
Analog Devices Inc.	—	-58.04%	-30.47%	-36.91%	-84.20%	-26.34%
Applied Materials Inc.	—	7.01%	11.07%	15.26%	13.99%	7.75%
Broadcom Inc.	—	-20.84%	13.31%	11.53%	-7.39%	-23.63%
Intel Corp.	—	-44.89%	-25.19%	-11.71%	9.78%	15.11%
KLA Corp.	—	16.60%	18.45%	21.59%	13.92%	3.43%
Lam Research Corp.	—	2.29%	6.65%	16.60%	14.40%	2.32%
Micron Technology Inc.	—	-33.22%	-95.26%	0.08%	-7.56%	-19.81%
Monolithic Power Systems Inc.	—	9.16%	10.28%	12.88%	12.04%	7.65%
Qualcomm Inc.	—	8.01%	2.23%	19.30%	15.89%	8.62%
Texas Instruments Inc.	—	9.10%	19.43%	31.32%	30.71%	26.43%

Based on: 10-K (reporting date: 2025-01-26), 10-K (reporting date: 2024-01-28), 10-K (reporting date: 2023-01-29), 10-K (reporting date: 2022-01-30), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26).

¹ Economic profit. See details »

² 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × 58,229 ÷ 130,973 = 44.46%

³ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic profit margin	The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin.	NVIDIA Corp. economic profit margin improved from 2023 to 2024 and from 2024 to 2025.

NVIDIA Corp. (NASDAQ:NVDA)

Economic Value Added (EVA)

Economic Profit

Net Operating Profit after Taxes (NOPAT)

Cash Operating Taxes

Invested Capital

Cost of Capital

Economic Spread Ratio

Economic Profit Margin