Now Inc (DNOW)
Pretax margin
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
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Earnings before tax but after interest (EBT) (ttm) | US$ in thousands | 114,000 | 115,000 | 130,000 | 132,000 | 138,000 | 141,000 | 148,000 | 141,000 | 139,000 | 120,000 | 83,000 | 54,000 | 12,000 | -48,000 | -76,000 | -106,000 | -430,000 | -524,000 | -491,000 | -445,000 |
Revenue (ttm) | US$ in thousands | 2,373,000 | 2,357,000 | 2,339,000 | 2,300,000 | 2,321,000 | 2,313,000 | 2,302,000 | 2,247,000 | 2,136,000 | 2,021,000 | 1,883,000 | 1,744,000 | 1,632,000 | 1,519,000 | 1,406,000 | 1,376,000 | 1,619,000 | 1,939,000 | 2,364,000 | 2,770,000 |
Pretax margin | 4.80% | 4.88% | 5.56% | 5.74% | 5.95% | 6.10% | 6.43% | 6.28% | 6.51% | 5.94% | 4.41% | 3.10% | 0.74% | -3.16% | -5.41% | -7.70% | -26.56% | -27.02% | -20.77% | -16.06% |
December 31, 2024 calculation
Pretax margin = EBT (ttm) ÷ Revenue (ttm)
= $114,000K ÷ $2,373,000K
= 4.80%
Now Inc's pre-tax margin is a key indicator of its profitability before accounting for taxes. Looking at the trend over the past few years, we see that the company experienced negative pre-tax margins in the initial quarters of the data, indicating that the company was operating at a loss or with very minimal profitability.
However, the pre-tax margin started to show signs of improvement from the first quarter of 2021 onwards. The company managed to gradually turn around its profitability, with the pre-tax margin turning positive in the fourth quarter of 2021 and continuing to improve in the subsequent quarters.
The pre-tax margin increased steadily from 2022 to 2024, reaching a peak of 6.51% by the end of December 2022. However, from that point onwards, the pre-tax margin slightly decreased in the following quarters but still remained around the high 5% range by the end of 2024.
This positive trend in the pre-tax margin indicates that Now Inc has been effective in managing its expenses and generating higher earnings before taxes relative to its revenue. It suggests that the company's operational efficiency and profitability have improved over the years, although there was a slight dip in the margins in the later periods. Monitoring this ratio will be crucial to assess the company's ability to sustain its profitability in the future.
Peer comparison
Dec 31, 2024