Allegro Microsystems Inc (ALGM)

Operating return on assets (Operating ROA)

		Mar 31, 2025	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Dec 23, 2022	Sep 30, 2022	Sep 23, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020
Operating income (ttm)	US$ in thousands	-19,802	32,096	68,823	137,671	219,047	243,451	272,393	265,106	254,198	250,932	200,041	164,662	140,429	119,145	136,650	125,849	66,020	39,868	12,158	11,615
Total assets	US$ in thousands	1,420,960	1,441,740	1,492,120	1,448,890	1,583,390	1,565,300	1,284,940	1,234,090	1,181,160	1,084,060	1,084,060	979,802	979,802	926,113	892,620	851,417	803,251	796,887	747,678	711,898
Operating ROA		-1.39%	2.23%	4.61%	9.50%	13.83%	15.55%	21.20%	21.48%	21.52%	23.15%	18.45%	16.81%	14.33%	12.87%	15.31%	14.78%	8.22%	5.00%	1.63%	1.63%

March 31, 2025 calculation

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

Allegro Microsystems Inc's operating return on assets (operating ROA) has shown fluctuations over the analyzed period. The operating ROA started at 1.63% in December 2020 and remained stable in March 2021. However, a significant increase was observed in June 2021, reaching 5.00%, and continued to rise steadily until December 2022, where it peaked at 23.15%.

Subsequently, there was a slight decline in the operating ROA in the following quarters of 2023, but it remained relatively high. However, by the end of December 2024, the operating ROA decreased significantly to 2.23%, indicating a decline in the company's operating efficiency in utilizing its assets to generate operating profits.

The trend continued in the first quarter of 2025, where the operating ROA fell into negative territory at -1.39%, suggesting a concerning decline in the company's operational performance relative to its asset base. This decline may indicate potential challenges in effectively leveraging assets to generate operating income and may warrant further investigation into operational efficiency and asset utilization strategies.