Illumina Inc (ILMN)
Return on total capital
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -1,040,000 | -1,050,000 | -3,953,000 | -4,514,000 | -4,310,000 | -4,051,000 | 49,000 | 903,000 | 945,000 | 1,160,000 | 952,000 | 905,000 | 906,000 | 871,000 | 926,000 | 1,114,000 | 1,182,000 | 1,144,000 | 1,121,000 | 1,009,000 |
| Long-term debt | US$ in thousands | 1,489,000 | 1,489,000 | 1,488,000 | — | 1,487,000 | — | — | — | 1,695,000 | — | — | — | 673,000 | 666,000 | 659,000 | 652,000 | 1,141,000 | 1,131,000 | 1,120,000 | 1,112,000 |
| Total stockholders’ equity | US$ in thousands | 5,745,000 | 5,898,000 | 6,555,000 | 6,693,000 | 6,599,000 | 6,731,000 | 10,444,000 | 10,895,000 | 10,740,000 | 10,593,000 | 5,180,000 | 4,922,000 | 4,694,000 | 4,700,000 | 4,563,000 | 4,635,000 | 4,613,000 | 4,439,000 | 4,332,000 | 3,985,000 |
| Return on total capital | -14.38% | -14.21% | -49.15% | -67.44% | -53.30% | -60.18% | 0.47% | 8.29% | 7.60% | 10.95% | 18.38% | 18.39% | 16.88% | 16.23% | 17.73% | 21.07% | 20.54% | 20.54% | 20.56% | 19.80% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $-1,040,000K ÷ ($1,489,000K + $5,745,000K)
= -14.38%
Illumina Inc's return on total capital has shown fluctuations over the past eight quarters. In Q4 2023 and Q3 2023, the company incurred negative returns, indicating that its capital employed did not generate sufficient profits. The improvement in Q1 2023, with a 1.19% return, suggests a partial recovery. However, this positive trend was followed by a stagnant performance in Q2 2023, where the return on total capital was recorded at 0.00%.
Comparing the recent quarters to the same period in the previous year, there has been a decline in performance. In Q4 2022, Illumina Inc achieved a return on total capital of 3.79%, which was higher compared to the latest quarters. Similarly, Q3 2022 and Q2 2022 also had relatively higher returns at 5.93% and -2.37% respectively.
Overall, the negative returns in Q4 2023 and Q3 2023 highlight potential issues with the company's capital allocation and efficiency in generating profits. This calls for a thorough review of Illumina Inc's capital utilization strategies to improve future financial performance.
Peer comparison
Dec 31, 2023