Fulgent Genetics Inc (FLGT)

Operating return on assets (Operating ROA)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Operating income US$ in thousands -73,918 -72,695 178,527 104,339 290,158
Total assets US$ in thousands 1,219,960 1,235,330 1,386,050 1,278,720 700,461
Operating ROA -6.06% -5.88% 12.88% 8.16% 41.42%

December 31, 2024 calculation

Operating ROA = Operating income ÷ Total assets
= $-73,918K ÷ $1,219,960K
= -6.06%

Operating ROA is a key financial ratio that measures a company's ability to generate operating profits from its assets. For Fulgent Genetics Inc, the trend in operating ROA over the past five years shows a significant decrease.

In December 31, 2020, the operating ROA was relatively high at 41.42%, indicating that the company was efficiently generating operating profits from its assets. However, there was a sharp decline in operating ROA to 8.16% by December 31, 2021. This suggests a decline in the company's operating efficiency or profitability relative to its asset base.

Although there was a slight improvement to 12.88% by December 31, 2022, the company's operating ROA turned negative in the subsequent years, with -5.88% in December 31, 2023, and -6.06% in December 31, 2024. This negative operating ROA indicates that Fulgent Genetics Inc is generating operating losses relative to its asset base.

The declining trend in operating ROA raises concerns about the company's operational efficiency and profitability. Management should closely monitor and address the factors contributing to this decline to improve the company's financial performance and overall health.