Yelp Inc (YELP)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 31.08% | 91.23% | 92.49% | 93.51% | 93.88% |
| Operating profit margin | 5.85% | 4.84% | 3.03% | -4.40% | 3.48% |
| Pretax margin | 7.78% | 5.54% | 3.24% | -3.99% | 4.88% |
| Net profit margin | 7.34% | 3.02% | 3.81% | -2.21% | 4.01% |
Yelp Inc's profitability ratios have shown varying trends over the past five years. The gross profit margin has generally remained high, ranging from 91.14% to 93.85%, indicating the company's ability to efficiently control the cost of goods sold.
However, the operating profit margin has fluctuated, with a negative margin of -4.00% in 2020 but then improving to 5.91% in 2023. This suggests fluctuations in the company's operating expenses and efficiency in generating operating income.
The pretax margin also improved significantly from -4.02% in 2020 to 7.86% in 2023, indicating better control over non-operating expenses. The net profit margin has similarly shown variability, ranging from a negative margin of -2.23% in 2019 to a high of 7.42% in 2023.
Overall, while Yelp Inc has shown resilience in maintaining a high gross profit margin, fluctuations in operating and net profit margins indicate ongoing challenges in controlling operating expenses and maximizing profitability. Further analysis of cost management and revenue generation strategies may be necessary to sustain and improve overall profitability in the future.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 7.79% | 5.74% | 3.00% | -3.36% | 3.32% |
| Return on assets (ROA) | 9.77% | 3.58% | 3.78% | -1.68% | 3.82% |
| Return on total capital | 10.55% | 8.21% | 4.19% | -4.54% | 4.70% |
| Return on equity (ROE) | 13.23% | 5.12% | 5.28% | -2.27% | 5.41% |
Yelp Inc's profitability ratios showed a positive trend over the past five years. The Operating return on assets (Operating ROA) improved steadily from 3.32% in 2019 to 7.79% in 2023, indicating the company's ability to generate operating income from its assets. Similarly, Return on assets (ROA) increased from -1.68% in 2020 to 9.77% in 2023, reflecting an enhancement in the company's overall profitability relative to its total assets.
Return on total capital also exhibited a favorable trend, rising from -4.09% in 2020 to 10.55% in 2023, suggesting effective utilization of both equity and debt capital to generate returns. Moreover, Return on equity (ROE) saw an improvement from -2.27% in 2020 to 13.23% in 2023, indicating a growth in shareholder value creation.
Overall, Yelp Inc's profitability ratios demonstrate a positive performance, showcasing the company's efficiency in generating profits from its assets, capital, and equity, which bodes well for its financial health and future prospects.