Viavi Solutions Inc (VIAV)

Return on total capital

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	20,800	87,800	88,400	145,500	127,700
Long-term debt	US$ in thousands	636,000	629,500	616,500	224,100	600,900
Total stockholders’ equity	US$ in thousands	681,600	690,800	671,700	763,900	633,200
Return on total capital		1.58%	6.65%	6.86%	14.73%	10.35%

June 30, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $20,800K ÷ ($636,000K + $681,600K)
= 1.58%

Viavi Solutions Inc's return on total capital has shown a decreasing trend over the last five years. The return on total capital was 1.58% as of June 30, 2024, down from 6.65% in the previous year and 6.86% in the year before that. This decline indicates that the company is generating lower returns relative to its total capital employed.

Comparing to the higher returns of 14.73% in 2021 and 10.35% in 2020, it appears that Viavi Solutions Inc's efficiency in generating profits from its total capital has decreased in recent years. Further analysis is needed to determine the reasons behind this declining trend and to assess the company's overall financial performance and capital management strategies.