Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
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- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Common-Size Balance Sheet: Assets
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Capital Asset Pricing Model (CAPM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Assets (ROA) since 2007
- Total Asset Turnover since 2007
- Analysis of Debt
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Economic Profit
Super Micro Computer Inc., economic profit calculation
US$ in thousands
| 12 months ended: | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | |
|---|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | |||||||
| Cost of capital2 | |||||||
| Invested capital3 | |||||||
| Economic profit4 | |||||||
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- The net operating profit after taxes demonstrates a fluctuating but overall upward trend across the periods. Initially, there was a decrease from 123,581 thousand USD in 2019 to 70,352 thousand USD in 2020. This was followed by a recovery to 103,035 thousand USD in 2021 and a significant increase in 2022 to 314,116 thousand USD. The upward trajectory continued strongly through 2023 and 2024, reaching 627,683 and 1,116,783 thousand USD respectively, indicating substantial growth in profitability in the later years.
- Cost of Capital
- The cost of capital remains relatively stable throughout the observed years, fluctuating narrowly between approximately 16.22% and 18.56%. It starts at 18.32% in 2019, decreases slightly to its lowest point of 16.22% in 2022, and then rises again to 18.56% in 2023 before settling at 17.61% in 2024. The minor variations suggest a consistent cost structure for capital over the timeframe.
- Invested Capital
- The invested capital exhibits an overall rising trend with a notable surge towards the end of the period. From 1,150,419 thousand USD in 2019, it gradually increases to 1,282,041 thousand USD by 2021. A sharp increase is observed in 2022 and 2023, reaching 2,222,919 and 2,437,425 thousand USD respectively. The highest value is recorded in 2024 at 7,676,769 thousand USD, indicating significant expansion or capital investment in that final year.
- Economic Profit
- Economic profit consistently remains negative for most of the periods, reflecting returns below the cost of capital. It starts at -87,138 thousand USD in 2019, deteriorates further to a low of -156,907 thousand USD in 2020, and then slightly improves but remains negative at -125,611 thousand USD in 2021. A reduction in the negative margin is seen in 2022 with -46,442 thousand USD, followed by a positive economic profit of 175,363 thousand USD in 2023. However, in 2024 economic profit drops back to negative territory at -235,047 thousand USD, despite the highest NOPAT and invested capital, suggesting that the cost of capital or the scale of investment may outweigh returns in this final period.
Net Operating Profit after Taxes (NOPAT)
Super Micro Computer Inc., NOPAT calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowance for credit losses.
3 Addition of increase (decrease) in deferred revenue.
4 Addition of increase (decrease) in accrued warranty costs.
5 Addition of increase (decrease) in equity equivalents to net income.
6 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
7 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
8 Addition of after taxes interest expense to net income.
9 2024 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =
10 Elimination of after taxes investment income.
The financial data exhibits a significant upward trend in both net income and net operating profit after taxes (NOPAT) over the five-year period.
- Net Income
- Net income increased consistently from 71,918 thousand US dollars in 2019 to 1,152,666 thousand US dollars in 2024. This represents a substantial growth trajectory, with particularly sharp increases observed from 2021 onwards. The most notable surge occurs between 2022 and 2023, where net income more than doubles, followed by continued robust growth into 2024.
- Net Operating Profit After Taxes (NOPAT)
- NOPAT showed some fluctuation in earlier years, decreasing from 123,581 thousand US dollars in 2019 to 70,352 thousand US dollars in 2020. However, starting in 2021, there is a clear recovery and subsequent strong growth, reaching 1,116,783 thousand US dollars in 2024. The pattern of increase closely parallels that of net income, indicating improved operating efficiency and higher profitability from core operations in recent years.
Overall, the financial data suggests a period of transformation characterized by increased profitability and operational improvements, especially evident in the last three years. The upward trend indicates strengthening financial performance and potentially successful strategic initiatives driving both net income and operating profit growth.
Cash Operating Taxes
Super Micro Computer Inc., cash operating taxes calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
The financial data reveals considerable fluctuations in both the income tax provision and cash operating taxes over the examined periods.
- Income Tax Provision
- The income tax provision exhibits a variable trend, initially decreasing sharply from 14,884 thousand USD in 2019 to 2,922 thousand USD in 2020. It then increased moderately to 6,936 thousand USD in 2021, followed by a significant rise to 52,876 thousand USD in 2022. The upward trend continued, reaching a peak of 110,666 thousand USD in 2023, before declining to 63,294 thousand USD in 2024. Overall, despite the volatility, the income tax provision shows a substantial increase from 2019 to 2024, peaking notably in the period ending June 30, 2023.
- Cash Operating Taxes
- Cash operating taxes demonstrate a pronounced upward trend throughout the period analyzed. Starting at 33,161 thousand USD in 2019, they decreased to 17,343 thousand USD in 2020 and slightly declined again to 15,997 thousand USD in 2021. However, from 2022 onward, there is a marked escalation, with cash operating taxes rising to 61,030 thousand USD, then surging significantly to 205,704 thousand USD in 2023, and further increasing to 236,509 thousand USD in 2024. This indicates an increasing cash outflow related to operating taxes in recent years.
In summary, both income tax provision and cash operating taxes have experienced significant increases over the examined time frame, particularly from 2022 onwards. The steep rises in these tax-related expenses suggest substantial changes in taxable income, tax rates, or tax payment strategies, impacting the cash flow and financial position associated with taxation.
Invested Capital
Super Micro Computer Inc., invested capital calculation (financing approach)
US$ in thousands
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
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 accrued warranty costs.
6 Addition of equity equivalents to total Super Micro Computer, Inc. stockholders’ equity.
7 Removal of accumulated other comprehensive income.
8 Subtraction of buildings construction in progress.
9 Subtraction of investment in marketable equity security.
- Total Reported Debt & Leases
- The total reported debt and leases exhibited a fluctuating yet overall increasing trend over the period. Starting at 41,119 thousand USD in 2019, the figure rose moderately to 53,813 thousand USD in 2020 before more than doubling to 119,051 thousand USD in 2021. A substantial spike occurred in 2022, with debt and leases reaching 620,564 thousand USD, followed by a decline to 309,462 thousand USD in 2023. However, in 2024, there was a dramatic surge to 2,209,527 thousand USD, indicating a significant increase in leverage or financing activities in the most recent year.
- Total Stockholders’ Equity
- Stockholders’ equity demonstrated consistent growth throughout the period. Beginning at 941,015 thousand USD in 2019, it increased steadily each year, reaching 1,065,540 thousand USD in 2020, 1,096,225 thousand USD in 2021, and 1,425,575 thousand USD in 2022. The upward trend accelerated in 2023 with equity amounting to 1,972,005 thousand USD, and then showed a marked rise to 5,417,206 thousand USD in 2024. This strong expansion in equity suggests substantial retained earnings or capital injections contributing to the company's net worth over time.
- Invested Capital
- The invested capital followed a gradual upward path initially, increasing from 1,150,419 thousand USD in 2019 to 1,239,197 thousand USD in 2020 and 1,282,041 thousand USD in 2021. A significant jump occurred in 2022, with invested capital reaching 2,222,919 thousand USD, followed by a further increase to 2,437,425 thousand USD in 2023. The most striking change was recorded in 2024, where invested capital more than tripled, reaching 7,676,769 thousand USD. This pronounced increase aligns with the large rise in debt and stockholders’ equity, indicating substantial capital deployment in the company’s assets or operations.
Cost of Capital
Super Micro Computer Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2024-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2019-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Super Micro Computer Inc., economic spread ratio calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Economic profit1 | |||||||
| Invested capital2 | |||||||
| Performance Ratio | |||||||
| Economic spread ratio3 | |||||||
| Benchmarks | |||||||
| Economic Spread Ratio, Competitors4 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Dell Technologies Inc. | |||||||
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 Economic profit. See details »
2 Invested capital. See details »
3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Economic Profit
- The economic profit exhibits significant volatility over the observed periods. Starting with a negative value of -87,138 thousand US dollars in 2019, it worsened to -156,907 thousand in 2020. Thereafter, a gradual improvement is observed in 2021 and 2022, reaching -46,442 thousand. The year 2023 marked a notable positive turnaround with an economic profit of 175,363 thousand, indicating improved profitability. However, this positive trend reversed sharply in 2024, with economic profit declining to -235,047 thousand, representing the lowest point in the span of six years.
- Invested Capital
- The invested capital demonstrates a steady upward trend from 2019 through 2023, increasing from 1,150,419 thousand US dollars to 2,437,425 thousand. This indicates a period of expansion or increased investment in the business. However, in 2024, there is a dramatic spike to 7,676,769 thousand, which is more than triple the previous year's figure. Such a significant increase may reflect a major capital deployment or revaluation.
- Economic Spread Ratio
- The economic spread ratio follows a pattern similar to economic profit, remaining negative for the majority of the period. It starts at -7.57% in 2019, deteriorates to -12.66% in 2020, then gradually improves to -2.09% by 2022. In 2023, the ratio turns positive to 7.19%, suggesting a period of effective capital utilization and economic value creation. Nonetheless, in 2024, the ratio falls back to -3.06%, indicating a decline in economic rent and efficiency.
Economic Profit Margin
Super Micro Computer Inc., economic profit margin calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Economic profit1 | |||||||
| Net sales | |||||||
| Add: Increase (decrease) in deferred revenue | |||||||
| Adjusted net sales | |||||||
| Performance Ratio | |||||||
| Economic profit margin2 | |||||||
| Benchmarks | |||||||
| Economic Profit Margin, Competitors3 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Dell Technologies Inc. | |||||||
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 Economic profit. See details »
2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted net sales
= 100 × ÷ =
3 Click competitor name to see calculations.
- Adjusted Net Sales
- Adjusted net sales exhibited a fluctuating upward trend over the reported periods. Beginning at approximately $3.56 billion in 2019, there was a slight decline in 2020 to around $3.34 billion, followed by a rebound to about $3.56 billion in 2021. A significant increase occurred thereafter, with sales reaching roughly $5.23 billion in 2022 and continuing to grow substantially to approximately $7.19 billion in 2023. The most notable surge took place in 2024, when net sales more than doubled to about $15.10 billion.
- Economic Profit
- Economic profit demonstrated considerable volatility and overall negative performance throughout the timeframe. The company experienced substantial economic losses in 2019 and 2020, with values approximately -$87.1 million and -$156.9 million, respectively. Although the loss magnitude decreased somewhat in 2021 and 2022, reaching about -$125.6 million and -$46.4 million, respectively, a reversal occurred in 2023 showing a positive economic profit of approximately $175.4 million. However, the most recent period in 2024 reverted back to a significant economic loss approaching -$235 million.
- Economic Profit Margin
- The economic profit margin aligned with the trends observed in economic profit, remaining negative for the majority of the periods analyzed. Starting at -2.45% in 2019, the margin worsened to -4.7% in 2020, then improved somewhat to -3.53% in 2021 and further to -0.89% in 2022. The margin turned positive in 2023, reaching 2.44%, indicating a temporary improvement in profitability relative to sales. However, in 2024, the margin declined again to -1.56%, signaling renewed pressure on profitability despite the substantial sales growth.
- Summary
- The data reveals a complex financial trajectory characterized by strong growth in net sales, particularly from 2022 onwards. Despite this growth, economic profitability has been inconsistent, with sustained losses in the initial years, a brief profitable interval in 2023, and a return to losses in 2024. The economic profit margin reflects this volatility, showing negative margins most years, a positive spike in 2023, and a subsequent decline. These patterns suggest challenges in converting increased sales into sustained economic profit, indicating potential issues with cost management, capital efficiency, or other operational factors affecting overall financial performance.