NXP Semiconductors NV (NXPI)
Return on total capital
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 3,551,000 | 3,774,000 | 3,774,000 | 3,776,000 | 3,713,000 | 3,786,000 | 3,781,000 | 3,778,000 | 3,807,000 | 3,656,000 | 3,350,000 | 2,988,000 | 2,608,000 | 2,182,000 | 1,497,000 | 779,000 | 359,000 | 151,000 | 368,000 | 764,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 9,531,000 | 9,406,000 | 9,018,000 | 8,829,000 | 8,644,000 | 8,488,000 | 8,172,000 | 7,949,000 | 7,449,000 | 7,106,000 | 6,962,000 | 6,509,000 | 6,528,000 | 6,738,000 | 7,442,000 | 8,303,000 | 8,944,000 | 8,876,000 | 8,862,000 | 9,036,000 |
| Return on total capital | 37.26% | 40.12% | 41.85% | 42.77% | 42.95% | 44.60% | 46.27% | 47.53% | 51.11% | 51.45% | 48.12% | 45.91% | 39.95% | 32.38% | 20.12% | 9.38% | 4.01% | 1.70% | 4.15% | 8.46% |
December 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $3,551,000K ÷ ($—K + $9,531,000K)
= 37.26%
NXP Semiconductors NV has exhibited fluctuations in its return on total capital over the past few years, with a general upward trend in recent periods. The return on total capital stood at 8.46% as of March 31, 2020, which then declined to 4.15% by June 30, 2020, before further dropping to 1.70% by September 30, 2020. However, there was a notable improvement in performance as the return on total capital increased to 9.38% by March 31, 2021, and surged significantly to 51.45% by September 30, 2022. The metrics reached its peak at 51.11% by December 31, 2022, before gradually trending downwards to 37.26% by December 31, 2024.
The return on total capital indicates the efficiency with which the company utilizes all its capital to generate profit, encompassing both debt and equity. The upward trend in the metric from 2020 to 2022 signifies an improvement in capital utilization efficiency, which may have been driven by operational enhancements, strategic investments, or favorable market conditions. The subsequent decline in return on total capital from 2022 to 2024 suggests potential challenges or changes in the company's financial structure impacting profitability.
Overall, monitoring the return on total capital allows stakeholders to assess NXP Semiconductors NV's ability to generate returns relative to the total resources invested in the business, providing insights into the company's financial performance and capital utilization efficiency over time.
Peer comparison
Dec 31, 2024