Grid Dynamics Holdings Inc (GDYN)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | — | -4,426 | -20,453 | 50 | -15,448 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 517,829 | 382,907 | 363,044 | 227,051 | 151,728 |
| Return on total capital | 0.00% | -1.16% | -5.63% | 0.02% | -10.18% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $517,829K)
= 0.00%
Grid Dynamics Holdings Inc has experienced fluctuating performance in terms of return on total capital over the past five years. In December 31, 2020, the company posted a negative return on total capital of -10.18%, indicating that its capital was not efficiently utilized to generate profits. Subsequently, by the end of December 31, 2021, the return on total capital improved slightly to 0.02%, though remaining close to breakeven.
However, the company's return on total capital dipped again to -5.63% by December 31, 2022, reflecting a decline in the efficiency of capital deployment. This negative trend continued into December 31, 2023, with a return on total capital of -1.16%, indicating ongoing challenges in generating returns relative to the capital invested.
Nonetheless, by December 31, 2024, the return on total capital stabilized at 0.00%, suggesting a break-even point where the company's capital was neither earning nor losing on average. Overall, the varying performance in return on total capital highlights the importance for Grid Dynamics Holdings Inc to effectively manage its capital allocation and operational efficiency to enhance profitability in the future.
Peer comparison
Dec 31, 2024