Amgen Inc (AMGN)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 29.22% | 70.77% | 71.61% | 71.12% | 76.40% |
| Operating profit margin | 30.89% | 18.66% | 15.04% | 35.95% | 41.41% |
| Pretax margin | 30.72% | 14.33% | 13.19% | 31.99% | 39.11% |
| Net profit margin | 26.27% | 12.78% | 11.60% | 28.57% | 33.57% |
AMGEN Inc.'s profitability ratios provide insight into the company's ability to generate profits relative to its revenue and costs. The gross profit margin, showing the percentage of revenue remaining after deducting the cost of goods sold, has exhibited a decreasing trend from 81.35% in 2019 to 70.02% in 2023, potentially indicating higher production costs or pricing pressures.
The operating profit margin, indicating the percentage of revenue remaining after deducting operating expenses, also decreased over the years from 41.41% in 2019 to 28.01% in 2023. This suggests that the company's operational efficiency may have declined, possibly due to higher expenses or lower revenue growth.
The pretax margin, reflecting the percentage of revenue remaining after deducting all operating expenses and taxes but before interest, displayed fluctuations over the years, with a significant drop from 39.11% in 2019 to 27.86% in 2023. This volatility may stem from changes in tax liabilities or fluctuations in operating costs.
Lastly, the net profit margin, which represents the percentage of revenue remaining as net income after all expenses, depicts a declining trend from 33.57% in 2019 to 23.83% in 2023. This indicates that AMGEN Inc.'s bottom-line profitability has been impacted by various factors, such as rising costs or declining sales.
In summary, the analysis of AMGEN Inc.'s profitability ratios reveals a decreasing trend in margins over the years, suggesting challenges in maintaining profitability and cost efficiency. Further investigation into the company's cost structure, revenue drivers, and operational strategies may be warranted to address these trends and enhance overall financial performance.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 8.13% | 14.69% | 12.49% | 14.52% | 16.20% |
| Return on assets (ROA) | 6.91% | 10.06% | 9.63% | 11.54% | 13.13% |
| Return on total capital | 11.38% | 23.32% | 19.13% | 21.60% | 26.42% |
| Return on equity (ROE) | 107.78% | 178.97% | 87.96% | 77.20% | 81.07% |
AMGEN Inc.'s profitability ratios show some fluctuations over the past five years.
- Operating return on assets (Operating ROA) has decreased steadily from 16.20% in 2019 to 8.13% in 2023, indicating a decline in the company's ability to generate operating income from its assets.
- Return on assets (ROA) has also declined over the period, from 13.13% in 2019 to 6.91% in 2023. This suggests that the overall profitability of the company in generating earnings from its assets has decreased.
- Return on total capital shows fluctuations but mostly a decreasing trend, from 24.44% in 2019 to 11.15% in 2023. This indicates a decline in the company's ability to generate returns on its total capital employed.
- Return on equity (ROE) has been quite volatile over the past five years, with significant fluctuations. This ratio shows very high returns in some years, such as 178.97% in 2019 and 107.78% in 2023, indicating high profitability in relation to shareholders' equity.
Overall, the profitability ratios of AMGEN Inc. suggest a mixed performance, with declining trends in some key ratios like ROA and ROA, but high returns on equity indicating strong profitability in relation to shareholder investments. Further analysis of the company's financial performance and operational efficiency is recommended to understand the reasons behind these fluctuations and trends in profitability ratios.