Yelp Inc (YELP)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 91.24% | 91.46% | 91.14% | 92.43% | 93.45% |
| Operating profit margin | 10.70% | 5.91% | 4.89% | 3.05% | -3.56% |
| Pretax margin | 12.96% | 7.86% | 5.60% | 3.27% | -4.02% |
| Net profit margin | 9.41% | 7.42% | 3.05% | 3.84% | -2.23% |
Yelp Inc's profitability ratios show a strong trend of improvement over the years. The gross profit margin, which measures the percentage of revenue remaining after deducting the cost of goods sold, decreased slightly from 93.45% in 2020 to 91.24% in 2024, indicating efficient cost management.
The operating profit margin, representing the percentage of revenue left after deducting operating expenses, started at -3.56% in 2020, showing operating losses, but improved significantly to 10.70% by 2024. This suggests increased operational efficiency and better control over expenses.
The pretax margin, which indicates the percentage of revenue remaining after deducting all expenses except taxes, also exhibited noticeable growth from -4.02% in 2020 to 12.96% in 2024. This reveals improved profitability before tax considerations.
Finally, the net profit margin, showing the percentage of revenue remaining after deducting all expenses including taxes, grew consistently from -2.23% in 2020 to 9.41% in 2024. This demonstrates Yelp Inc's ability to generate more profit from its revenue over time, reflecting a positive trend in overall profitability.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 15.36% | 7.79% | 5.74% | 3.00% | -2.69% |
| Return on assets (ROA) | 13.51% | 9.77% | 3.58% | 3.78% | -1.68% |
| Return on total capital | 20.30% | 10.55% | 2.13% | 4.50% | -10.90% |
| Return on equity (ROE) | 17.86% | 13.23% | 5.12% | 5.28% | -2.27% |
Yelp Inc's profitability ratios show an improving trend over the years. The Operating Return on Assets (Operating ROA) increased from -2.69% in 2020 to 15.36% in 2024, indicating that the company is becoming more efficient in generating operating profits from its assets.
Similarly, the Return on Assets (ROA) also exhibited growth, rising from -1.68% in 2020 to 13.51% in 2024, demonstrating an improvement in the overall profitability of the company relative to its total assets.
Moreover, the Return on Total Capital, a measure of how effectively the company is generating profits from its total capital, saw significant advancement from -10.90% in 2020 to 20.30% in 2024, reflecting Yelp Inc's ability to utilize its capital more efficiently in generating returns.
Additionally, the Return on Equity (ROE), which represents the returns earned for the equity invested in the company, exhibited a positive trajectory from -2.27% in 2020 to 17.86% in 2024, indicating an increasing return for the shareholders over the years.
Overall, Yelp Inc's profitability ratios depict a favorable performance trend, with improving efficiency in utilizing assets and generating returns for both investors and the company itself.