Intel Corporation (INTC)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	53,879,000	61,811,000	78,168,000	76,984,000	71,052,000
Property, plant and equipment	US$ in thousands	96,647,000	80,860,000	63,245,000	56,584,000	55,386,000
Fixed asset turnover		0.56	0.76	1.24	1.36	1.28

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $53,879,000K ÷ $96,647,000K
= 0.56

The fixed asset turnover ratio measures how efficiently a company is utilizing its fixed assets to generate revenue. A higher fixed asset turnover indicates better efficiency in utilizing fixed assets to generate sales.

From the data provided, we observe a declining trend in Intel Corporation's fixed asset turnover over the past five years. In 2020, the fixed asset turnover was at its peak at 1.36, indicating that Intel was generating $1.36 in revenue for every $1 of fixed assets. However, this ratio decreased significantly to 0.56 in 2023, suggesting a decrease in the efficiency of utilizing fixed assets to generate sales.

The declining trend in fixed asset turnover could be indicative of several factors. It may suggest that Intel's fixed asset base has significantly increased without a proportionate increase in revenue generation. This could result from investments in fixed assets that are not generating expected returns or underutilization of existing fixed assets. Additionally, it could also imply that Intel's sales have decreased relative to its fixed asset base, signaling potential inefficiencies in operations or declining demand for its products.

Overall, the decreasing trend in Intel Corporation's fixed asset turnover ratio warrants further investigation into the company's investment strategies, operational efficiency, and revenue generation capabilities to address the declining efficiency in utilizing fixed assets.