Semtech Corporation (SMTC)

Pretax margin

		Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Earnings before tax but after interest (EBT)	US$ in thousands	-1,041,510	78,724	141,203	63,340	44,699
Revenue	US$ in thousands	772,240	763,171	735,908	589,413	538,320
Pretax margin		-134.87%	10.32%	19.19%	10.75%	8.30%

January 28, 2024 calculation

Pretax margin = EBT ÷ Revenue
= $-1,041,510K ÷ $772,240K
= -134.87%

The pretax margin of Semtech Corporation has shown variability over the past five years. In the most recent fiscal year, ending January 28, 2024, the company reported a negative pretax margin of -134.87%, indicating that its operating expenses and/or non-operating expenses exceeded its revenue, resulting in a loss before tax. This significant decrease from the previous fiscal year's pretax margin of 10.32% raises concerns about the company's profitability and cost management.

In contrast, the fiscal year ending January 30, 2022, displayed a relatively strong pretax margin of 19.19%, indicating a healthy level of profitability before accounting for taxes. While this demonstrated a positive trend from the prior fiscal year's pretax margin of 10.75%, it is essential to note that the pretax margin has fluctuated over the years, as seen in the fiscal year ending January 31, 2021, where the pretax margin was 10.75%.

The pretax margin of Semtech Corporation in the fiscal year ending January 26, 2020, was 8.30%, which showed a moderate level of profitability. Overall, the fluctuating pretax margin of Semtech Corporation suggests varying levels of efficiency in managing operating expenses, generating revenue, and controlling costs over the years, necessitating a closer examination of the company's financial performance and strategic direction.