Microchip Technology Inc (MCHP)

Operating return on assets (Operating ROA)

		Mar 31, 2024	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
Operating income (ttm)	US$ in thousands	2,571,000	3,165,500	3,447,700	3,317,800	3,116,000	2,817,500	2,520,900	2,182,100	1,849,600	1,608,100	1,338,700	1,148,600	998,100	850,800	736,400	693,800	647,100	771,000	834,500	753,600
Total assets	US$ in thousands	15,873,200	16,143,000	16,601,400	16,494,600	16,370,300	16,116,100	16,141,100	16,208,400	16,199,500	16,047,200	16,215,000	16,277,800	16,478,800	16,576,100	16,770,900	17,028,100	17,426,100	17,588,600	17,858,500	18,246,400
Operating ROA		16.20%	19.61%	20.77%	20.11%	19.03%	17.48%	15.62%	13.46%	11.42%	10.02%	8.26%	7.06%	6.06%	5.13%	4.39%	4.07%	3.71%	4.38%	4.67%	4.13%

March 31, 2024 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $2,571,000K ÷ $15,873,200K
= 16.20%

Operating Return on Assets (ROA) is a key financial ratio that measures a company's ability to generate profits from its assets used in operations. For Microchip Technology Inc, the operating ROA has shown a generally increasing trend over the past few quarters, indicating improved efficiency in utilizing its assets to generate earnings.

The operating ROA for the most recent quarter, ending on March 31, 2024, stands at 16.20%. This indicates that Microchip Technology Inc generated approximately $0.16 in operating income for every dollar of assets deployed in its operations during that period.

Looking at the historical trend, we see that the operating ROA has been steadily increasing since the end of 2021, with some fluctuations in between. This suggests that the company has been able to improve its operational efficiency and profitability relative to its asset base over time.

The highest operating ROA of 20.77% was recorded in the quarter ending on September 30, 2023, while the lowest was 3.71% in the quarter ending on March 31, 2020. These fluctuations may be influenced by various factors such as changes in revenue, expenses, or asset utilization efficiency.

Overall, the increasing trend in operating ROA for Microchip Technology Inc indicates that the company has been effectively managing its assets to generate operating profits, which is a positive signal for investors and stakeholders interested in its financial performance.