Wolfspeed Inc (WOLF)
Profitability ratios
Return on sales
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 9.59% | 27.66% | 35.66% | 34.44% | 18.00% |
| Operating profit margin | -55.15% | -35.51% | -35.44% | -65.67% | -25.45% |
| Pretax margin | -106.90% | -37.41% | -27.45% | -109.37% | -22.68% |
| Net profit margin | -107.03% | -37.57% | -28.73% | -109.60% | -21.77% |
Wolfspeed Inc's profitability ratios have shown fluctuating trends over the past five years. The gross profit margin has noticeably decreased from 35.66% in 2022 to 9.59% in 2024, indicating a significant decline in the company's ability to generate profit after accounting for cost of goods sold.
Operating profit margin has been consistently negative, with a particularly low point in 2021 at -65.67%. This implies that the company's operating expenses have exceeded gross profit consistently over the years, leading to operating losses.
Pretax margin has displayed a wide range of results, with a sharp decrease in profitability in 2024, registering a significant negative pretax margin of -106.90%. This metric suggests that the company's performance before tax deductions has been consistently weak, with a severe deterioration in its financial position in the most recent year.
Net profit margin, reflecting the company's bottom-line profitability, has been negative throughout the period under review. The highest net profit margin was -21.77% in 2020, but this deteriorated to -107.03% in 2024. This indicates that the company has been consistently failing to generate net profits after accounting for all expenses, with the situation worsening in the most recent year.
Overall, Wolfspeed Inc's profitability ratios depict a challenging financial performance characterized by declining gross profit margins, persistent operating losses, and worsening bottom-line results over the past five years.
Return on investment
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -5.58% | -4.73% | -6.33% | -9.11% | -6.94% |
| Return on assets (ROA) | -10.82% | -5.01% | -5.13% | -15.20% | -5.93% |
| Return on total capital | -6.32% | -4.93% | -4.82% | -16.24% | -5.75% |
| Return on equity (ROE) | -97.97% | -20.34% | -8.24% | -24.75% | -9.20% |
Wolfspeed Inc's profitability ratios reveal a fluctuating performance over the past five years. The company's operating return on assets (Operating ROA) ranged from -9.11% in 2021 to -4.73% in 2023, showing a negative trend. This indicates that the company's core operations have been less efficient in generating profits relative to its total assets.
The return on assets (ROA) varied from -15.20% in 2021 to -5.01% in 2023, with negative figures indicating that the company has struggled to generate earnings from its assets. Similarly, the return on total capital ranged from -16.24% in 2021 to -4.82% in 2022, pointing to a challenge in earning returns on the total invested capital.
Wolfspeed Inc's return on equity (ROE) experienced significant fluctuations, with a sharp decline from -9.20% in 2020 to -97.97% in 2024. This demonstrates that the company's profitability relative to shareholders' equity has deteriorated substantially, signaling potential financial difficulties or inefficiencies in utilizing equity funding.
Overall, the profitability ratios indicate a concerning trend in Wolfspeed Inc's ability to generate profits from its assets, capital, and equity over the past five years. Investors and stakeholders may need to closely monitor the company's financial performance and consider potential strategies to improve profitability and sustainability in the future.