TKO Group Holdings, Inc. (TKO)
Profitability ratios
Return on sales
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross profit margin | 68.66% | 57.00% | 56.09% | 58.14% | 63.15% | 71.16% | 71.12% | 71.01% | 71.44% | 64.07% | 56.75% | 48.07% | 40.73% |
| Operating profit margin | 24.33% | 24.44% | 25.00% | 24.07% | 28.77% | 37.82% | 47.35% | 47.33% | 47.75% | 42.84% | 36.50% | 29.28% | 23.38% |
| Pretax margin | 1.22% | -0.44% | -2.15% | -7.98% | 12.39% | 21.04% | 31.24% | 33.25% | 35.39% | 34.98% | 30.48% | 25.05% | 20.99% |
| Net profit margin | 0.34% | -1.26% | -0.53% | 0.44% | 11.95% | 21.15% | 29.93% | 31.92% | 33.97% | 32.22% | 26.90% | 21.02% | 16.20% |
TKO Group Holdings, Inc. has shown a positive trend in its profitability ratios over the past few years. The gross profit margin has been steadily increasing, reaching a peak of 71.44% in December 2022 before slightly declining to 68.66% by December 2024. This indicates the company's ability to effectively manage its production costs and generate profits from its core operations.
Similarly, the operating profit margin has followed an upward trajectory, peaking at 47.75% in December 2022, showing strong operational efficiency and effective cost management. However, there was a slight decrease to 24.33% by December 2024, which might signify potential challenges in maintaining operational profitability.
The pretax margin also exhibited growth until September 2023, reaching 34.98%, showcasing the company's ability to generate profit before accounting for tax expenses. However, the margin experienced a significant decline in the following quarters, with negative percentages recorded in March and September 2024. This could indicate challenges or exceptional items impacting the company's pre-tax profitability.
Lastly, the net profit margin, which represents the company's bottom line efficiency, has displayed a similar trend as the pretax margin. The net profit margin peaked at 33.97% in December 2022 and gradually declined to 0.34% by December 2024. This decline could be attributed to various factors like increasing expenses, one-time charges, or declining revenues.
Overall, TKO Group Holdings, Inc. has generally demonstrated strong profitability performance, although some declining trends in the later periods suggest potential challenges that may require further analysis and strategic management decisions to maintain sustainable profitability levels.
Return on investment
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 5.37% | 5.31% | 5.00% | 3.78% | 3.80% | 3.96% | 16.21% | 15.86% | 15.20% | 37.88% | 31.21% | 25.66% | 20.98% |
| Return on assets (ROA) | 0.07% | -0.27% | -0.11% | 0.07% | 1.58% | 2.21% | 10.25% | 10.70% | 10.82% | 28.49% | 23.00% | 18.42% | 14.54% |
| Return on total capital | 6.93% | 6.11% | 5.07% | 0.81% | 7.27% | 8.14% | 51.93% | 51.33% | 57.17% | 65.34% | 71.02% | 72.33% | 70.12% |
| Return on equity (ROE) | 0.23% | -0.86% | -0.34% | 0.22% | 4.87% | 6.77% | 62.43% | 67.53% | 68.07% | 80.59% | 66.75% | 57.15% | 47.35% |
The profitability ratios of TKO Group Holdings, Inc. show a fluctuating trend over the analyzed periods.
1. Operating return on assets (Operating ROA) increased from 20.98% in December 31, 2021, to a peak of 37.88% in September 30, 2022, before declining to 5.37% by December 31, 2024. This indicates the variability in the company's operating efficiency in generating profits from its assets.
2. Return on assets (ROA) also followed a similar pattern, starting at 14.54% in December 31, 2021, peaking at 28.49% in September 30, 2022, and then dropping to 0.07% by March 31, 2024. The significant decrease in ROA towards the latter periods suggests challenges in maintaining profitability relative to total assets.
3. Return on total capital started at a high point of 70.12% on December 31, 2021, fluctuated, and ended at 6.93% by December 31, 2024. This metric reflects the company's ability to generate returns from its total invested capital, and the downward trend signifies declining efficiency in managing capital investment for profitability.
4. Return on equity (ROE) depicted a similar fluctuating trend, rising from 47.35% on December 31, 2021, to a peak of 80.59% on September 30, 2022, before significantly decreasing to 0.23% by December 31, 2024. This indicates the variability in the company's ability to generate profits for its shareholders relative to their equity investment.
In conclusion, the profitability ratios of TKO Group Holdings, Inc. suggest a mixed performance over the analyzed periods, highlighting the company's varying levels of efficiency in generating profits from assets, total capital, and equity. The decreasing trends in some metrics towards the latter periods may indicate potential challenges in sustaining profitability and maximizing returns for investors.