Trade Desk Inc (TTD)

Return on total capital

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	427,167	200,480	113,654	42,283	82,307
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	2,949,140	2,164,220	2,115,340	1,527,310	1,013,140
Return on total capital		14.48%	9.26%	5.37%	2.77%	8.12%

December 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $427,167K ÷ ($—K + $2,949,140K)
= 14.48%

The analysis of Trade Desk Inc's return on total capital (ROTC) over the specified period reveals notable fluctuations and trends. As of December 31, 2020, the company's ROTC stood at 8.12%, indicating a relatively strong initial capital efficiency. However, this metric declined significantly by December 31, 2021, to 2.77%, suggesting a period of reduced operational effectiveness or increased capital investment that did not immediately translate into proportional returns.

Following this decline, the ROTC experienced a recovery, increasing to 5.37% by the end of 2022. This upward movement indicates improvements in the company's ability to generate returns from its total capital base, possibly driven by operational enhancements or strategic initiatives. The positive trend continued into 2023, with the ROTC reaching 9.26%, nearly doubling the 2022 figure, which underscores a considerable strengthening in capital productivity.

Most recently, as of December 31, 2024, the ROTC further improved to 14.48%. This substantial increase suggests that the company has significantly enhanced its efficiency in utilizing its total capital to generate earnings, reflecting favorable operational or strategic developments. Overall, the trend from 2020 through 2024 indicates a notable recovery and growth phase for Trade Desk Inc, culminating in its highest reported return on total capital within this timeframe.