Alpha and Omega Semiconductor Ltd (AOSL)

Return on total capital

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	-3,756	22,529	102,038	64,076	-13,937
Long-term debt	US$ in thousands	26,724	38,360	42,486	77,990	99,775
Total stockholders’ equity	US$ in thousands	891,607	883,919	854,093	373,205	293,689
Return on total capital		-0.41%	2.44%	11.38%	14.20%	-3.54%

June 30, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-3,756K ÷ ($26,724K + $891,607K)
= -0.41%

The return on total capital for Alpha and Omega Semiconductor Ltd has fluctuated over the past five years. In 2024, the return on total capital was negative at -0.41%, indicating that the company did not generate a positive return on the total capital employed in its operations. This may suggest inefficiencies in the utilization of capital resources during that year.

In the previous years, the return on total capital shows a mixed performance. In 2023, the return improved to 2.44% from the negative returns in 2020, reflecting a recovery in capital efficiency. The performance was even stronger in 2022 and 2021, with returns of 11.38% and 14.20% respectively, indicating that the company was able to generate favorable returns on the capital invested in its operations during those years.

However, in 2020, the return on total capital was negative at -3.54%, suggesting that the company faced challenges in generating positive returns on its capital investments. This could be a concerning sign regarding the company's operational efficiency and profitability during that period.

Overall, the trend in Alpha and Omega Semiconductor Ltd's return on total capital shows variability in performance, with fluctuations in efficiency and profitability over the years. Further analysis and monitoring of the company's capital management strategies may be necessary to assess and address the reasons behind these fluctuations.