Microchip Technology Inc (MCHP)

Return on assets (ROA)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	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
Net income (ttm)	US$ in thousands	308,800	781,600	1,369,800	1,906,900	2,356,200	2,517,300	2,396,900	2,237,700	2,071,600	1,844,100	1,539,900	1,285,500	963,600	647,000	478,600	349,400	333,300	608,200	643,500	570,600
Total assets	US$ in thousands	15,632,200	15,622,300	15,839,700	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
ROA		1.98%	5.00%	8.65%	12.01%	14.60%	15.16%	14.53%	13.67%	12.85%	11.42%	9.50%	7.94%	6.00%	3.99%	2.94%	2.12%	2.01%	3.63%	3.78%	3.27%

December 31, 2024 calculation

ROA = Net income (ttm) ÷ Total assets
= $308,800K ÷ $15,632,200K
= 1.98%

Microchip Technology Inc's return on assets (ROA) has shown fluctuations over the past few years, starting at 3.27% as of March 31, 2020, and gradually increasing to a peak of 15.16% by September 30, 2023. This upward trend indicates improving efficiency in generating profits from its assets during this period.

However, there was a slight decrease in ROA to 14.60% by December 31, 2023, followed by a more significant decline to 12.01% by March 31, 2024. This decline may suggest challenges in maintaining or further improving asset efficiency.

The ROA continued to decline in the subsequent quarters, reaching 1.98% by December 31, 2024. This sharp decrease indicates a potential decrease in the company's ability to generate profits from its assets efficiently.

Overall, while Microchip Technology Inc has shown a generally positive trend in ROA over the analyzed period, the recent decline in the ratio raises concerns about the company's asset utilization efficiency and profitability. Further analysis and monitoring of Microchip Technology Inc's financial performance are recommended to understand the underlying reasons for the fluctuations in ROA.