Power Integrations Inc (POWI)

Return on total capital

		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
Earnings before interest and tax (EBIT) (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
Long-term debt	US$ in thousands	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	752,241	785,057	767,929	762,302	755,216	750,282	710,245	820,573	912,032	908,356	870,344	853,823	810,411	779,797	759,472	743,830	724,546	565,328	543,865	531,301
Return on total capital		4.66%	7.26%	11.42%	17.73%	23.89%	27.17%	28.31%	22.66%	19.19%	17.45%	14.66%	11.19%	8.70%	29.03%	30.17%	30.38%	29.95%	7.33%	7.71%	9.00%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $35,059K ÷ ($—K + $752,241K)
= 4.66%

The return on total capital of Power Integrations Inc. has shown a decreasing trend over recent quarters. The return on total capital decreased from 22.66% in Q1 2022 to 4.66% in Q4 2023. This decline indicates a reduction in the company's ability to generate profit from its total capital employed. It is important to further investigate the reasons behind this trend, such as changes in operating efficiency, profitability, or capital structure, to better understand the company's overall financial performance and sustainability.