Super Micro Computer Inc (SMCI)
Profitability ratios
Return on sales
| Mar 31, 2025 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross profit margin | 11.27% | 12.44% | 13.20% | 13.75% | 15.97% | 16.39% | 17.44% | 18.01% | 18.23% | 17.80% | 16.78% | 15.40% | 14.22% | 13.68% | 14.18% | 15.03% | 15.14% | 16.03% | 15.91% | 15.76% |
| Operating profit margin | 6.09% | 7.42% | 8.23% | 8.08% | 9.72% | 9.13% | 9.31% | 10.33% | 10.25% | 10.39% | 8.75% | 6.45% | 4.52% | 3.27% | 3.20% | 3.48% | 2.79% | 2.85% | 2.52% | 2.57% |
| Pretax margin | 5.97% | 7.47% | 8.17% | 8.10% | 9.65% | 9.25% | 9.57% | 10.59% | 10.58% | 10.39% | 8.86% | 6.48% | 4.48% | 3.19% | 3.08% | 3.33% | 2.65% | 2.68% | 2.42% | 2.54% |
| Net profit margin | 5.34% | 6.94% | 7.55% | 7.69% | 8.88% | 7.92% | 8.29% | 8.98% | 8.93% | 8.70% | 7.38% | 5.49% | 3.96% | 3.00% | 2.89% | 3.14% | 2.69% | 2.71% | 2.56% | 2.52% |
The profitability ratios of Super Micro Computer Inc. over the specified period reveal several important insights into the company's financial performance and trend patterns.
Gross Profit Margin:
The gross profit margin demonstrates a general increasing trend from 15.76% on June 30, 2020, to a peak of 18.23% on March 31, 2023. This suggests an improvement in the company's ability to manage production costs relative to revenue, possibly due to better sourcing, efficiencies, or product mix. Post-peak, the margin exhibits slight fluctuations, with a decline to 12.44% by December 31, 2024, and further down to 11.27% on March 31, 2025, indicating potential pressures on cost control or competitive pricing strategies affecting gross profitability in recent periods.
Operating Profit Margin:
Operating profit margins show a steady upward trajectory from 2.57% on June 30, 2020, reaching a high of approximately 10.58% on March 31, 2022. The margin peaks around this period, reflecting improved operational efficiency and possibly better expense management. However, subsequent periods indicate a declining trend, falling to about 6.09% by March 31, 2025. This decline may be attributable to rising operating expenses, increased competition, or other operational challenges impacting earnings before interest and taxes.
Pre-Tax Margin:
Similar to the operating margin, the pre-tax profit margin increases from 2.54% on June 30, 2020, to a high of approximately 10.58% on March 31, 2022. The subsequent downward trend is evident, with the margin decreasing to about 5.97% by March 31, 2025. This pattern indicates that gains on operational efficiency are being offset by factors such as increased interest expenses, taxes, or other non-operational costs.
Net Profit Margin:
The net profit margin follows a comparable trend, rising from 2.52% on June 30, 2020, to a peak of around 8.98% on June 30, 2023. Post that period, margins decline, reaching 5.34% on March 31, 2025. This decline emphasizes that the company’s bottom-line profitability has been under pressure, potentially due to rising tax burdens, interest costs, or other net expenses.
Overall Observations:
The period from mid-2020 through early 2023 experienced a strengthening of profit margins across all profitability ratios, indicative of effective cost management, operational improvements, or favorable market conditions. Starting from 2023 onward, there is a discernible deterioration in profitability ratios, suggesting a challenging environment affecting the company's ability to sustain previous levels of profitability. These declines could be driven by increased competitive pressures, rising input or operational costs, or macroeconomic factors impacting market demand and cost structures.
In summary, Super Micro Computer Inc. has demonstrated a significant improvement in profitability up to early 2023, followed by a downward trend indicating potential headwinds impacting the company's ability to generate and sustain higher profit margins.
Return on investment
| Mar 31, 2025 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 12.23% | 15.88% | 14.26% | 12.18% | 12.96% | 15.62% | 16.80% | 20.02% | 21.12% | 22.45% | 15.94% | 10.46% | 6.81% | 5.09% | 5.05% | 5.53% | 4.72% | 4.90% | 4.58% | 4.46% |
| Return on assets (ROA) | 10.72% | 14.85% | 13.09% | 11.59% | 11.84% | 13.55% | 14.96% | 17.42% | 18.39% | 18.81% | 13.45% | 8.90% | 5.97% | 4.67% | 4.56% | 4.99% | 4.56% | 4.67% | 4.65% | 4.39% |
| Return on total capital | 20.83% | 25.47% | 26.73% | 22.55% | 22.73% | 28.23% | 33.26% | 38.60% | 39.56% | 37.96% | 31.88% | 22.94% | 15.77% | 10.80% | 10.83% | 11.31% | 10.61% | 10.36% | 9.39% | 9.83% |
| Return on equity (ROE) | 18.04% | 23.16% | 24.16% | 21.07% | 20.59% | 23.80% | 28.29% | 32.45% | 33.21% | 31.80% | 27.33% | 20.00% | 14.41% | 10.53% | 9.77% | 10.20% | 8.65% | 8.32% | 7.88% | 7.91% |
Super Micro Computer Inc. has demonstrated a notable trajectory in its profitability ratios over the specified period. The Operating Return on Assets (Operating ROA) has shown a consistent upward trend from approximately 4.46% on June 30, 2020, reaching a peak of approximately 22.45% at the end of December 2022. The ratio experienced temporary fluctuations thereafter, declining to around 12.23% by March 2025. This pattern indicates periods of improved efficiency in generating operating income relative to the company's operating assets, especially during the 2021-2022 interval, which aligns with a significant escalation in profitability metrics.
The standard Return on Assets (ROA), measuring overall net profitability relative to total assets, followed a similar trajectory. It increased from just over 4.39% in June 2020 to around 18.81% in December 2022. Post-2022, this ratio exhibited a decline, settling at approximately 10.72% by March 2025. These trends suggest periods of enhanced net income generation, potentially driven by operational efficiencies or favorable market conditions during 2021-2022, followed by normalization or contraction in subsequent periods.
Return on Total Capital (ROTC) reflected substantial growth, rising from roughly 9.83% on June 30, 2020, to an apex of nearly 38% at the end of 2022 before decreasing to approximately 20.83% by March 2025. The sharp increase during 2021-2022 underscores improved utilization of both debt and equity capital for generating earnings, with subsequent moderation indicating a tapering of peak profitability levels.
Return on Equity (ROE) experienced a pronounced rise, from around 7.91% in June 2020 to over 33% in March 2022, making it a period of substantial shareholder value creation. After reaching this peak, ROE declined to approximately 18% by March 2025, aligning with broader earnings normalization and possibly changes in leverage or net income margins.
Overall, the profitability ratios reveal a period of rapid improvement with peak performance in 2021-2022, possibly driven by operational efficiencies, market share gains, or favorable product cycles. However, since then, profitability appears to have stabilized or declined, potentially due to market saturation, increased competition, or macroeconomic factors impacting revenue growth and margins. The general trend suggests that Super Micro Computer Inc. experienced its most robust profitability phase during 2021-2022, with subsequent normalization toward more sustainable, albeit lower, levels in recent periods.
See also:
Super Micro Computer Inc Profitability Ratios (Quarterly Data)