Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Long-term Activity Ratios (Summary)
Corning Inc., long-term (investment) activity ratios
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).
The investment activity ratios exhibit a consistent cyclical pattern between 2019 and 2023, characterized by a temporary contraction in efficiency during 2020, a period of expansion and peaking in 2022, and a moderate correction in 2023. This synchronicity across all measured ratios suggests that the fluctuations in asset and equity productivity were driven by broad operational or market-wide factors rather than isolated changes in specific asset classes.
- Fixed Asset Utilization
- Net fixed asset turnover showed a decline from 0.75 in 2019 to 0.72 in 2020, before climbing to a five-year peak of 0.92 in 2022. When including operating lease right-of-use assets, the trend remains identical, peaking at 0.88 in 2022. The subsequent decline to 0.86 (and 0.81 for ROU assets) in 2023 indicates a slight reduction in the revenue-generating efficiency of long-term physical investments.
- Overall Asset Efficiency
- Total asset turnover mirrored the fixed asset trends, dipping to 0.37 in 2020 and recovering to a high of 0.48 in 2022. The consistently lower values of total asset turnover relative to fixed asset turnover indicate a significant presence of non-fixed assets on the balance sheet that generate revenue at a lower rate than the core fixed infrastructure.
- Equity Productivity
- Equity turnover demonstrated the most significant volatility and growth among the analyzed ratios. After a dip to 0.85 in 2020, the ratio increased sharply to 1.14 in 2021 and peaked at 1.18 in 2022. Although it decreased to 1.09 in 2023, the level remains substantially higher than the pre-2021 baseline, suggesting an overall improvement in how shareholder equity is utilized to generate sales over the five-year period.
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Net Fixed Asset Turnover
Corning Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 12,588) | 14,189) | 14,082) | 11,303) | 11,503) | |
| Property, plant and equipment, net of accumulated depreciation | 14,630) | 15,371) | 15,804) | 15,742) | 15,337) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 0.86 | 0.92 | 0.89 | 0.72 | 0.75 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Apple Inc. | 8.77 | 9.36 | 9.28 | 7.47 | — | |
| Arista Networks Inc. | 57.69 | 46.11 | 37.49 | — | — | |
| Cisco Systems Inc. | 27.34 | 25.82 | 21.31 | — | — | |
| Dell Technologies Inc. | 16.48 | 18.69 | 14.65 | — | — | |
| Lumentum Holdings Inc. | 3.61 | 4.75 | 4.83 | — | — | |
| Super Micro Computer Inc. | 24.54 | 18.17 | 12.95 | — | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Technology Hardware & Equipment | 10.54 | 11.11 | 10.59 | — | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Information Technology | 3.80 | 4.46 | 4.76 | — | — | |
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
Net fixed asset turnover = Net sales ÷ Property, plant and equipment, net of accumulated depreciation
= 12,588 ÷ 14,630 = 0.86
2 Click competitor name to see calculations.
The efficiency of long-term asset utilization exhibited a non-linear trend between 2019 and 2023, characterized by an initial contraction, a period of significant improvement, and a subsequent decline in the final year.
- Net Fixed Asset Turnover Fluctuations
- The net fixed asset turnover ratio declined from 0.75 in 2019 to 0.72 in 2020. This was followed by a sharp increase to 0.89 in 2021 and a peak of 0.92 in 2022. However, the ratio retreated to 0.86 by December 31, 2023, indicating a reduction in the revenue-generating efficiency of the fixed asset base after a two-year period of growth.
- Impact of Revenue Trends
- The improvement in asset turnover between 2020 and 2022 was driven primarily by a substantial increase in net sales, which grew from 11,303 million to 14,189 million. The peak turnover ratio of 0.92 in 2022 reflects the highest level of productivity derived from the company's investment in property, plant, and equipment during the analyzed period.
- Fixed Asset Base Dynamics
- Net property, plant, and equipment remained relatively stable through 2021, peaking at 15,804 million, before beginning a gradual decline to 14,630 million by 2023. While the asset base decreased in 2023, the turnover ratio also fell because the decline in net sales to 12,588 million was more pronounced than the reduction in net fixed assets.
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Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Corning Inc., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 12,588) | 14,189) | 14,082) | 11,303) | 11,503) | |
| Property, plant and equipment, net of accumulated depreciation | 14,630) | 15,371) | 15,804) | 15,742) | 15,337) | |
| Operating lease right-of-use assets | 883) | 842) | 741) | 680) | 504) | |
| Property, plant and equipment, net of accumulated depreciation (including operating lease, right-of-use asset) | 15,513) | 16,213) | 16,545) | 16,422) | 15,841) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 0.81 | 0.88 | 0.85 | 0.69 | 0.73 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Apple Inc. | 7.05 | 7.51 | 7.39 | 6.06 | — | |
| Arista Networks Inc. | 37.21 | 29.52 | 20.50 | — | — | |
| Cisco Systems Inc. | 18.65 | 17.19 | 14.51 | — | — | |
| Dell Technologies Inc. | 14.75 | 16.10 | 11.02 | — | — | |
| Lumentum Holdings Inc. | 3.12 | 3.95 | 4.07 | — | — | |
| Super Micro Computer Inc. | 23.02 | 16.78 | 12.07 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Technology Hardware & Equipment | 8.52 | 8.90 | 8.31 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Information Technology | 3.33 | 3.86 | 4.04 | — | — | |
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
Net fixed asset turnover (including operating lease, right-of-use asset) = Net sales ÷ Property, plant and equipment, net of accumulated depreciation (including operating lease, right-of-use asset)
= 12,588 ÷ 15,513 = 0.81
2 Click competitor name to see calculations.
The analysis of long-term asset utilization reveals a period of fluctuating operational efficiency between 2019 and 2023, characterized by a significant improvement in asset productivity during 2021 and 2022 followed by a moderate correction in 2023.
- Revenue Performance Trends
- Net sales exhibited volatility over the five-year period. After a slight contraction in 2020, revenue experienced a substantial increase, peaking at US$ 14,189 million in 2022. However, 2023 saw a decline to US$ 12,588 million, signaling a reduction in top-line growth compared to the previous biennium.
- Fixed Asset Base Dynamics
- The net property, plant, and equipment, including right-of-use assets, grew from US$ 15,841 million in 2019 to a peak of US$ 16,545 million in 2021. Subsequently, a downward trend emerged, with the asset base decreasing to US$ 15,513 million by the end of 2023, suggesting a period of asset depreciation or divestment that exceeded new capital expenditures.
- Net Fixed Asset Turnover Analysis
- The net fixed asset turnover ratio reflects a cyclical pattern of efficiency. An initial decline to 0.69 in 2020 was followed by a sharp recovery, with the ratio reaching 0.88 in 2022. This peak was driven by the strong growth in net sales occurring while the asset base remained relatively stable. In 2023, the ratio retreated to 0.81, as the contraction in net sales occurred more rapidly than the reduction in the net fixed asset base, resulting in lower overall asset productivity.
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Total Asset Turnover
Corning Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 12,588) | 14,189) | 14,082) | 11,303) | 11,503) | |
| Total assets | 28,500) | 29,499) | 30,154) | 30,775) | 28,898) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 0.44 | 0.48 | 0.47 | 0.37 | 0.40 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Apple Inc. | 1.09 | 1.12 | 1.04 | 0.85 | — | |
| Arista Networks Inc. | 0.59 | 0.65 | 0.51 | — | — | |
| Cisco Systems Inc. | 0.56 | 0.55 | 0.51 | — | — | |
| Dell Technologies Inc. | 1.14 | 1.09 | 0.76 | — | — | |
| Lumentum Holdings Inc. | 0.38 | 0.41 | 0.49 | — | — | |
| Super Micro Computer Inc. | 1.94 | 1.62 | 1.59 | — | — | |
| Total Asset Turnover, Sector | ||||||
| Technology Hardware & Equipment | 0.99 | 1.01 | 0.89 | — | — | |
| Total Asset Turnover, Industry | ||||||
| Information Technology | 0.61 | 0.64 | 0.62 | — | — | |
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
Total asset turnover = Net sales ÷ Total assets
= 12,588 ÷ 28,500 = 0.44
2 Click competitor name to see calculations.
The analysis of total asset turnover between 2019 and 2023 reveals a period of fluctuation in asset utilization efficiency, characterized by an initial decline, a significant recovery, and a subsequent correction in the final year.
- Net Sales Performance
- Revenue experienced a slight contraction in 2020 before surging in 2021 and reaching a peak in 2022 at 14,189 million US$. A downward adjustment occurred in 2023, with sales falling to 12,588 million US$, indicating volatility in top-line generation over the five-year period.
- Total Asset Base Trends
- The asset base expanded from 28,898 million US$ in 2019 to a peak of 30,775 million US$ in 2020. From 2021 through 2023, a consistent downward trend in total assets was observed, concluding the period at 28,500 million US$, which suggests a reduction in the capital employed to generate revenue.
- Total Asset Turnover Dynamics
- The turnover ratio declined to 0.37 in 2020, coinciding with the simultaneous increase in assets and decrease in sales. Efficiency improved sharply in 2021 and 2022, reaching a high of 0.48 as sales grew while the asset base contracted. The ratio retreated to 0.44 in 2023, as the decline in net sales outweighed the continued reduction in total assets.
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Equity Turnover
Corning Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 12,588) | 14,189) | 14,082) | 11,303) | 11,503) | |
| Total Corning Incorporated shareholders’ equity | 11,551) | 12,008) | 12,333) | 13,257) | 12,907) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 1.09 | 1.18 | 1.14 | 0.85 | 0.89 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Apple Inc. | 6.17 | 7.78 | 5.80 | 4.20 | — | |
| Arista Networks Inc. | 0.81 | 0.90 | 0.74 | — | — | |
| Cisco Systems Inc. | 1.29 | 1.30 | 1.21 | — | — | |
| Dell Technologies Inc. | — | — | 38.01 | — | — | |
| Lumentum Holdings Inc. | 1.30 | 0.91 | 0.88 | — | — | |
| Super Micro Computer Inc. | 3.61 | 3.64 | 3.25 | — | — | |
| Equity Turnover, Sector | ||||||
| Technology Hardware & Equipment | 4.89 | 5.76 | 4.55 | — | — | |
| Equity Turnover, Industry | ||||||
| Information Technology | 1.54 | 1.71 | 1.77 | — | — | |
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
Equity turnover = Net sales ÷ Total Corning Incorporated shareholders’ equity
= 12,588 ÷ 11,551 = 1.09
2 Click competitor name to see calculations.
The analysis of long-term activity ratios from 2019 to 2023 reveals a period of volatility in revenue generation efficiency relative to the equity base. While the equity turnover ratio experienced a significant peak in the middle of the period, a downward correction occurred in the final year.
- Equity Turnover Performance
- The equity turnover ratio exhibited a slight contraction between 2019 and 2020, moving from 0.89 to 0.85. This was followed by a substantial improvement in 2021 and 2022, where the ratio rose to 1.14 and 1.18, respectively. By December 31, 2023, the ratio declined to 1.09, indicating a reduction in the efficiency of equity utilization for sales generation compared to the preceding two years.
- Revenue and Equity Correlation
- The increase in turnover observed in 2021 and 2022 was driven by a simultaneous increase in net sales and a decrease in total shareholders' equity. Net sales grew from 11.303 billion USD in 2020 to a peak of 14.189 billion USD in 2022, while equity steadily declined from 13.257 billion USD in 2020 to 12.008 billion USD in 2022. This divergence maximized the turnover ratio during this window.
- Analysis of 2023 Contraction
- In 2023, a downward trend in net sales to 12.588 billion USD exerted downward pressure on the turnover ratio. Although total shareholders' equity continued to decrease to 11.551 billion USD—which typically supports a higher turnover ratio—the magnitude of the sales decline outweighed the reduction in the equity base, resulting in the ratio falling to 1.09.
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