Power Integrations Inc (POWI)

Operating return on assets (Operating ROA)

		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	Mar 31, 2019
Operating income (ttm)	US$ in thousands	35,059	57,002	87,661	135,122	180,412	203,824	201,045	185,919	175,058	158,481	127,630	95,579	70,487	226,403	229,160	225,995	217,022	41,422	41,949	47,808
Total assets	US$ in thousands	819,868	865,490	859,457	851,405	840,096	837,963	809,004	919,195	1,014,490	1,004,990	967,849	944,719	903,339	876,068	853,777	827,439	803,896	636,410	620,389	600,505
Operating ROA		4.28%	6.59%	10.20%	15.87%	21.48%	24.32%	24.85%	20.23%	17.26%	15.77%	13.19%	10.12%	7.80%	25.84%	26.84%	27.31%	27.00%	6.51%	6.76%	7.96%

December 31, 2023 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $35,059K ÷ $819,868K
= 4.28%

Operating Return on Assets (ROA) is a key financial metric that indicates the efficiency with which Power Integrations Inc. generates operating profits relative to its total assets. The trend of Power Integrations Inc.'s operating ROA over the past eight quarters shows a gradual decline from a high of 24.99% in Q2 2022 to 4.28% in Q4 2023. This decreasing trend suggests a potential inefficiency in utilizing the company's assets to generate operating profits.

The operating ROA of Power Integrations Inc. declined significantly from Q2 2023 (10.20%) to Q4 2023 (4.28%). This sharp decline may indicate challenges or inefficiencies in the company's operations during the most recent quarter. It is important for investors and stakeholders to monitor this trend closely to assess whether this decline is a short-term fluctuation or a sustained issue affecting the company's profitability.

Comparing the most recent operating ROA figure of 4.28% in Q4 2023 to the eight-quarter historical data, it is evident that the company's current efficiency in generating operating profits relative to its assets is at a relatively low point. Investors should consider investigating the factors contributing to this decline and assess the company's strategy for improving operational efficiency and profitability in the future.