Allegro Microsystems Inc (ALGM)

Operating return on assets (Operating ROA)

		Mar 31, 2025	Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Operating income	US$ in thousands	-19,802	209,462	203,307	136,650	17,715
Total assets	US$ in thousands	1,420,960	1,530,600	1,181,160	892,620	747,678
Operating ROA		-1.39%	13.68%	17.21%	15.31%	2.37%

March 31, 2025 calculation

Operating ROA = Operating income ÷ Total assets
= $-19,802K ÷ $1,420,960K
= -1.39%

Allegro Microsystems Inc's operating return on assets (Operating ROA) has exhibited significant fluctuations over the past five years. The trend indicates a mixed performance in terms of utilizing assets to generate operating profits.

- In March 2021, the Operating ROA stood at 2.37%, indicating a relatively low efficiency in utilizing assets to generate operating earnings.
- By March 2022, the Operating ROA showed a substantial improvement, reaching 15.31%, reflecting a significant increase in operating profitability relative to assets employed.
- The trend continued to improve in the following year, with the Operating ROA further increasing to 17.21% by March 2023, signaling a more effective use of assets to drive operating earnings.
- However, in March 2024, there was a decrease in Operating ROA to 13.68%, suggesting a slight decrease in efficiency in generating operating profits from assets compared to the previous year.
- The most recent data point in March 2025 showing a negative Operating ROA of -1.39% raises concerns as it indicates that Allegro Microsystems Inc may be experiencing challenges in generating operating profits relative to the assets deployed.

Overall, Allegro Microsystems Inc's Operating ROA has been volatile, with both improvement and decline periods. It may be crucial for the company to focus on optimizing asset utilization to consistently enhance operating profitability and ensure sustainable growth.