Now Inc (DNOW)

Pretax margin

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Earnings before tax but after interest (EBT) US$ in thousands 114,000 138,000 139,000 12,000 -430,000
Revenue US$ in thousands 2,373,000 2,321,000 2,136,000 1,632,000 1,619,000
Pretax margin 4.80% 5.95% 6.51% 0.74% -26.56%

December 31, 2024 calculation

Pretax margin = EBT ÷ Revenue
= $114,000K ÷ $2,373,000K
= 4.80%

Now Inc's pretax margin has shown a mixed performance over the past five years. Starting at a negative pretax margin of -26.56% in December 2020, the company managed to improve its profitability significantly to reach a positive pretax margin of 6.51% by December 2022. However, there was a slight decrease in pretax margin to 5.95% by December 2023 and then a further decline to 4.80% by December 2024.

Overall, the pretax margin indicates the company's ability to control its operating costs in relation to its revenue before accounting for taxes. The positive trend from negative margins to positive margins is a positive sign of improved operational efficiency. However, the recent slight decline in pretax margin suggests the company may need to focus on sustaining or increasing profitability levels in the future.