Analysis of Reportable Segments
Amphenol Corp. operates in 3 segments: Harsh Environment Solutions; Communications Solutions; and Interconnect and Sensor Systems.
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- Income Statement
- Statement of Comprehensive Income
- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- Common Stock Valuation Ratios
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Assets (ROA) since 2005
- Debt to Equity since 2005
- Aggregate Accruals
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Segment Profit Margin
Amphenol Corp., profit margin by reportable segment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Harsh Environment Solutions | |||||
| Communications Solutions | |||||
| Interconnect and Sensor Systems |
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).
- Harsh Environment Solutions
- The profit margin for this segment exhibited a consistent upward trend starting from 24.36% in 2020 and rising steadily each year to reach 26.73% in 2023. This progression indicates an improvement in profitability and operational efficiency over the observed period.
- Communications Solutions
- This segment's profit margin showed minor fluctuations over the years. Beginning at 21.48% in 2020, it dipped slightly to 21.18% in 2021, then increased to 22.04% in 2022 before declining again to 21.65% in 2023. Overall, the margin remained relatively stable without marked growth or decline.
- Interconnect and Sensor Systems
- The profit margin for this segment demonstrated a notable improvement from 15.45% in 2020 to 18.55% in 2022, followed by a slight decrease to 18.33% in 2023. The trend reflects a positive trajectory in profitability over most of the period, with a small reduction in the most recent year.
Segment Profit Margin: Harsh Environment Solutions
Amphenol Corp.; Harsh Environment Solutions; segment profit margin calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Segment operating income | |||||
| Net sales | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
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 2023 Calculation
Segment profit margin = 100 × Segment operating income ÷ Net sales
= 100 × ÷ =
The reportable segment exhibits a clear upward trajectory in financial performance over the analyzed period. Net sales have increased consistently year-over-year, starting from approximately $2.29 billion in 2020 and reaching $3.53 billion in 2023. This represents a significant growth in revenue, indicating strong demand or successful market expansion within the segment.
Correspondingly, segment operating income has also shown steady improvement. Operating income rose from $556.8 million in 2020 to nearly $944 million in 2023. The growth in operating income aligns with the expansion in net sales, suggesting effective cost management or improved operational leverage that allows the segment to convert increased sales into higher operating profits.
Examining profitability further, the segment profit margin has improved every year, growing from 24.36% in 2020 to 26.73% in 2023. This trend indicates enhanced efficiency or pricing power, as a greater portion of sales revenue is being retained as operating profit. The consistently rising profit margin in conjunction with accelerating sales and operating income points to a strengthening business model in the segment.
- Net Sales
- Increased by approximately 54.5% over four years, reflecting robust growth in revenue generation.
- Operating Income
- Rose by approximately 69.6% from 2020 to 2023, suggesting improved profitability alongside sales growth.
- Segment Profit Margin
- Improved by over 2.3 percentage points during the period, indicating increased efficiency or favorable pricing.
Overall, the data displays a consistent and positive trend in financial performance that underscores both revenue growth and enhanced profitability within the segment from 2020 through 2023. The segment appears to be effectively leveraging its operations to achieve higher returns while expanding its sales base.
Segment Profit Margin: Communications Solutions
Amphenol Corp.; Communications Solutions; segment profit margin calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Segment operating income | |||||
| Net sales | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
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 2023 Calculation
Segment profit margin = 100 × Segment operating income ÷ Net sales
= 100 × ÷ =
- Operating Income
- Segment operating income exhibited an overall upward trend from 2020 through 2022, increasing from $871.2 million in 2020 to a peak of $1.2457 billion in 2022. However, in 2023, there was a noticeable decline to $1.0635 billion, representing a decrease from the preceding year but remaining above 2020 levels.
- Net Sales
- Net sales consistently increased from $4.0562 billion in 2020 to $5.6524 billion in 2022, indicating strong revenue growth in this segment over these years. In 2023, net sales experienced a significant decline to $4.9128 billion, which marks a reversal of the prior upward trend and a decrease of over 12% compared to the previous year.
- Segment Profit Margin
- The segment profit margin showed relative stability over the observed period, ranging between 21.18% and 22.04%. Starting at 21.48% in 2020, it slightly decreased to 21.18% in 2021, then increased to 22.04% in 2022, before slightly declining again to 21.65% in 2023. This indicates consistent profitability despite fluctuations in operating income and sales revenue.
- Overall Insights
- The segment demonstrated steady growth from 2020 to 2022 in both operating income and net sales, coupled with a relatively stable profit margin. The decline observed in 2023 for both operating income and net sales suggests a challenging year, possibly due to external or internal factors affecting sales volumes or pricing. Despite this, the segment maintained a solid profit margin above 21%, reflecting effective cost management or pricing strategies during the period of decreased revenue.
Segment Profit Margin: Interconnect and Sensor Systems
Amphenol Corp.; Interconnect and Sensor Systems; segment profit margin calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Segment operating income | |||||
| Net sales | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
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 2023 Calculation
Segment profit margin = 100 × Segment operating income ÷ Net sales
= 100 × ÷ =
- Segment Operating Income
- The segment operating income shows a consistent upward trend from 2020 through 2023. Starting at $348.6 million in 2020, it increased significantly to $588.1 million in 2021, followed by further growth to $716.5 million in 2022, and reached $753.7 million in 2023. This indicates strong growth in profitability within the segment over the analyzed period.
- Net Sales
- Net sales have exhibited sustained growth throughout the reported years. Beginning at approximately $2.26 billion in 2020, net sales climbed to $3.29 billion in 2021, then $3.86 billion in 2022, eventually reaching $4.11 billion in 2023. This upward trajectory reflects a consistent increase in revenue generation for the segment.
- Segment Profit Margin
- The segment profit margin has shown improvement from 2020 to 2022, growing from 15.45% to a peak of 18.55% in 2022. However, it slightly decreased to 18.33% in 2023. Despite this minor decline, the margin remains substantially higher than the 2020 level, suggesting enhanced operational efficiency and profitability over the period analyzed.
- Overall Trends and Insights
- Both revenue and operating income have demonstrated strong and consistent growth, indicating effective business expansion and enhanced market position within the Interconnect and Sensor Systems segment. The profit margin improvement through 2022 reflects increasing profitability efficiency, although the slight margin contraction in 2023 warrants monitoring. The data suggests positive momentum in sales and profitability, with an emphasis on maintaining margin stability going forward.
Net sales
Amphenol Corp., net sales by reportable segment
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Harsh Environment Solutions | |||||
| Communications Solutions | |||||
| Interconnect and Sensor Systems | |||||
| Total |
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).
- Harsh Environment Solutions
- Net sales demonstrated consistent growth from 2020 through 2023, starting at approximately 2.29 billion US dollars in 2020 and increasing steadily each year to reach 3.53 billion US dollars by 2023. This segment showed strong incremental gains annually, reflecting positive market reception and expansion within this category.
- Communications Solutions
- Sales increased notably from 4.06 billion US dollars in 2020 to a peak of 5.65 billion US dollars in 2022. However, in 2023, there was a marked decline to 4.91 billion US dollars. This drop suggests potential challenges or shifts within this segment, possibly due to market saturation, increased competition, or other external factors affecting demand.
- Interconnect and Sensor Systems
- This segment experienced substantial growth over the analyzed four-year period, with net sales rising from 2.26 billion US dollars in 2020 to 4.11 billion US dollars in 2023. The progression was particularly strong between 2020 and 2021, followed by continued upward trends in subsequent years, indicating an expanding customer base or enhanced product adoption.
- Total Net Sales
- Total net sales for all segments combined increased consistently from 8.60 billion US dollars in 2020 to a peak of 12.62 billion US dollars in 2022, then experienced a slight decrease to 12.55 billion US dollars in 2023. This overall trend reflects the strong growth in two segments (Harsh Environment Solutions and Interconnect and Sensor Systems), partially offset by the decline observed in Communications Solutions during the last year.
Segment operating income
Amphenol Corp., segment operating income by reportable segment
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Harsh Environment Solutions | |||||
| Communications Solutions | |||||
| Interconnect and Sensor Systems | |||||
| Total |
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).
- Overall Operating Income Trend
- The total segment operating income exhibited consistent growth from 2020 through 2022, increasing from approximately $1.78 billion to $2.76 billion. However, in 2023, the total operating income slightly declined by 0.1%, indicating a stabilization or minor downturn after several years of expansion.
- Harsh Environment Solutions
- This segment demonstrated robust and steady growth over the four-year period. Operating income increased significantly from $556.8 million in 2020 to $943.9 million in 2023, representing an overall growth rate of approximately 70%. The growth appears consistent year-over-year, with no periods of decline, suggesting effective market positioning or operational efficiencies within this segment.
- Communications Solutions
- Communications Solutions showed strong growth from 2020 to 2022, with operating income rising from $871.2 million to $1.25 billion. However, in 2023, there was a notable decline of approximately 14.6% to about $1.06 billion. This drop interrupts the previous upward trend and may warrant further investigation into market conditions or segment-specific challenges impacting profitability.
- Interconnect and Sensor Systems
- Operating income for this segment more than doubled from 2020 to 2021, jumping from $348.6 million to $588.1 million, followed by continued growth through 2022 and 2023, reaching $753.7 million. The growth rate moderated somewhat in the latter years but remained positive with an overall rise of approximately 116% over the four-year span.
- Comparative Insights
- Among the three segments, Harsh Environment Solutions showed the most consistent and accelerating growth, Communications Solutions experienced a peak followed by a downturn in the most recent period, and Interconnect and Sensor Systems reflected strong initial growth with continuing steady increases. The slight decline in total operating income during the last period seems largely influenced by the decrease in Communications Solutions, as the other two segments maintained growth.