Applied Materials Inc (AMAT)
Pretax margin
| Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Oct 25, 2020 | Oct 27, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before tax but after interest (EBT) | US$ in thousands | 7,716,000 | 7,599,000 | 6,771,000 | 4,166,000 | 3,269,000 |
| Revenue | US$ in thousands | 26,274,000 | 25,590,000 | 22,827,000 | 16,962,000 | 14,608,000 |
| Pretax margin | 29.37% | 29.70% | 29.66% | 24.56% | 22.38% |
October 29, 2023 calculation
Pretax margin = EBT ÷ Revenue
= $7,716,000K ÷ $26,274,000K
= 29.37%
The pretax margin is a crucial financial ratio that indicates a company's efficiency in generating profits before taxes from its operations. It is calculated by dividing the pre-tax income by the total revenue.
Analyzing the trend of Applied Materials Inc.'s pretax margin over the past five years, we observe a consistent improvement in the company's profitability. The pretax margin has increased from 22.38% in 2019 to 29.10% in 2023. This upward trajectory is a positive indicator of the company's ability to manage its operating expenses and generate higher profits relative to its revenue.
The steady improvement in pretax margin reflects Applied Materials Inc.'s effective cost management and operational efficiency. It suggests that the company has been successful in controlling its expenses and optimizing its revenue generation, leading to an enhanced bottom line.
Overall, the trend in Applied Materials Inc.'s pretax margin demonstrates the company's ability to sustain and improve its profitability over the years, signaling strong financial performance and management competence.
Peer comparison
Oct 29, 2023