Advanced Micro Devices Inc (AMD)

Return on equity (ROE)

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Net income (ttm)	US$ in thousands	854,000	208,000	-25,000	395,000	1,320,000	2,273,000	3,130,000	3,393,000	3,162,000	3,969,000	3,436,000	2,883,000	2,490,000	879,000	609,000	487,000	341,000	209,000	191,000	272,000
Total stockholders’ equity	US$ in thousands	55,892,000	54,970,000	55,136,000	54,694,000	54,750,000	54,542,000	55,169,000	55,333,000	7,497,000	7,136,000	7,065,000	6,477,000	5,837,000	3,867,000	3,305,000	3,037,000	2,827,000	2,176,000	1,901,000	1,788,000
ROE		1.53%	0.38%	-0.05%	0.72%	2.41%	4.17%	5.67%	6.13%	42.18%	55.62%	48.63%	44.51%	42.66%	22.73%	18.43%	16.04%	12.06%	9.60%	10.05%	15.21%

December 31, 2023 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $854,000K ÷ $55,892,000K
= 1.53%

Advanced Micro Devices Inc's return on equity (ROE) has shown considerable volatility over the past several quarters. The ROE was negative in the second and third quarters of 2023, indicating that the company was not generating returns to cover its equity investments during those periods. However, the ROE turned positive in the fourth quarter, although at a relatively low level of 0.72%.

Looking further back, the ROE has generally been on a declining trend since the end of 2021 when it reached a peak of 55.62%. The decrease in ROE could be a result of various factors such as changes in profitability, leverage, or asset management efficiency.

It is noteworthy that the ROE spiked significantly in the fourth quarter of 2021, reaching 42.18%, which indicates a period of high profitability relative to the company's equity base. However, this high level was not sustained in the following quarters.

Overall, the recent negative or low ROE figures suggest potential challenges in generating returns for shareholders. It would be important to further analyze AMD's financial performance and business strategies to understand the factors driving the ROE trends and assess the company's future prospects.