First Solar Inc (FSLR)

Return on total capital

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Earnings before interest and tax (EBIT)	US$ in thousands	904,255	20,823	585,269	315,097	-93,347
Long-term debt	US$ in thousands	464,068	184,349	236,005	237,691	454,187
Total stockholders’ equity	US$ in thousands	6,687,470	5,836,060	5,959,550	5,520,930	5,096,770
Return on total capital		12.64%	0.35%	9.45%	5.47%	-1.68%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $904,255K ÷ ($464,068K + $6,687,470K)
= 12.64%

First Solar Inc's return on total capital has shown variability over the past five years. In 2023, the company achieved a return on total capital of 12.22%, marking a significant improvement compared to the previous year where it was -4.66%. This positive trend indicates a more efficient use of the company's total capital to generate profits.

Looking back at the trend for the past five years, the return on total capital has generally been increasing, with fluctuations seen in some years. In 2021, the return on total capital was 7.09%, showing a notable increase from 2020's 5.54% and even more so compared to 2019's 3.61%.

Overall, the improving trend in return on total capital indicates that First Solar Inc has been effectively utilizing its total capital to generate returns for its shareholders. It suggests that the company is making efficient investment decisions and managing its capital effectively to drive profitability.