Microchip Technology Inc (MCHP)
Profitability ratios
Return on sales
| Mar 31, 2025 | Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | |
|---|---|---|---|---|---|
| Gross profit margin | 56.07% | 65.44% | 67.52% | 65.23% | 62.13% |
| Operating profit margin | 6.73% | 33.68% | 36.93% | 27.12% | 18.35% |
| Pretax margin | 0.88% | 30.99% | 34.48% | 21.73% | 6.24% |
| Net profit margin | -0.06% | 24.98% | 26.52% | 18.85% | 6.42% |
Microchip Technology Inc has shown a consistent improvement in its gross profit margin over the years, increasing from 62.13% in March 2021 to 67.52% in March 2023. However, there was a slight dip to 56.07% by March 2025.
The operating profit margin experienced significant fluctuations, with a sharp increase from 18.35% in March 2021 to 36.93% in March 2023, followed by a decline to 6.73% by March 2025.
The pretax margin also exhibited a similar trend of improvement, soaring from 6.24% in March 2021 to 34.48% in March 2023, then dropping to 0.88% in March 2025.
In terms of net profit margin, there was steady growth from 6.42% in March 2021 to 26.52% in March 2023, but a slight decrease to 24.98% by March 2024 and a negative margin of -0.06% by March 2025. Overall, these ratios reflect the company's fluctuating profitability performance over the period.
Return on investment
| Mar 31, 2025 | Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 1.93% | 16.20% | 19.03% | 11.42% | 6.06% |
| Return on assets (ROA) | -0.02% | 12.01% | 13.67% | 7.94% | 2.12% |
| Return on total capital | 0.00% | 38.43% | 47.80% | 29.51% | 13.05% |
| Return on equity (ROE) | -0.04% | 28.64% | 34.35% | 21.81% | 6.55% |
Microchip Technology Inc's profitability ratios show a mixed performance over the five-year period. The Operating Return on Assets (Operating ROA) increased from 6.06% in March 2021 to 19.03% in March 2023, but then decreased to 1.93% by March 2025. This indicates fluctuations in the company's ability to generate operating profits from its assets.
The Return on Assets (ROA) also followed a similar trend, starting at 2.12% in March 2021, peaking at 13.67% in March 2023, and turning negative to -0.02% by March 2025. The ROA reveals the overall effectiveness of management in utilizing the company's assets to generate profits.
In terms of Return on Total Capital, there was significant growth from 13.05% in March 2021 to 47.80% in March 2023, before dropping to 0.00% in March 2025. This ratio reflects how efficiently the company is generating returns from both debt and equity capital.
The Return on Equity (ROE) saw an upward trend from 6.55% in March 2021 to 34.35% in March 2023, but then declined to -0.04% by March 2025. ROE indicates the profitability of the company from the shareholder's perspective.
Overall, the profitability ratios of Microchip Technology Inc indicate varying levels of performance over the years, with fluctuations in the company's ability to generate profits relative to its assets, total capital, and equity.