Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
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- Analysis of Profitability Ratios
- Analysis of Liquidity Ratios
- Analysis of Solvency Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Analysis of Reportable Segments
- Price to FCFE (P/FCFE)
- Net Profit Margin since 2005
- Operating Profit Margin since 2005
- Total Asset Turnover since 2005
- Price to Book Value (P/BV) since 2005
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Economic Profit
Adobe Inc., economic profit calculation
US$ in millions
| 12 months ended: | Nov 29, 2024 | Dec 1, 2023 | Dec 2, 2022 | Dec 3, 2021 | Nov 27, 2020 | Nov 29, 2019 | |
|---|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | |||||||
| Cost of capital2 | |||||||
| Invested capital3 | |||||||
| Economic profit4 | |||||||
Based on: 10-K (reporting date: 2024-11-29), 10-K (reporting date: 2023-12-01), 10-K (reporting date: 2022-12-02), 10-K (reporting date: 2021-12-03), 10-K (reporting date: 2020-11-27), 10-K (reporting date: 2019-11-29).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
Net Operating Profit after Taxes (NOPAT)
Adobe Inc., NOPAT calculation
US$ in millions
Based on: 10-K (reporting date: 2024-11-29), 10-K (reporting date: 2023-12-01), 10-K (reporting date: 2022-12-02), 10-K (reporting date: 2021-12-03), 10-K (reporting date: 2020-11-27), 10-K (reporting date: 2019-11-29).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowances for doubtful accounts.
3 Addition of increase (decrease) in deferred revenue.
4 Addition of increase (decrease) in equity equivalents to net income.
5 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
6 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
7 Addition of after taxes interest expense to net income.
8 2024 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =
9 Elimination of after taxes investment income.
- Net Income
- The net income shows a notable overall increasing trend from 2019 to 2024. Starting at 2,951 million USD in 2019, it more than doubled by 2020 to 5,260 million USD, indicating a significant improvement in profitability. A slight decline is observed in 2021 and 2022, with net income values of 4,822 million USD and 4,756 million USD respectively. Nevertheless, from 2022 onward, net income resumes growth, reaching 5,428 million USD in 2023 and slightly increasing further to 5,560 million USD in 2024. This pattern suggests resilience and recovery after a brief downturn.
- Net Operating Profit After Taxes (NOPAT)
- The NOPAT figures demonstrate irregular fluctuations across the observed period. Initially, NOPAT increased steadily from 3,448 million USD in 2019 to 4,082 million USD in 2020. It then peaks sharply in 2021 at 6,201 million USD, representing a substantial rise in operating profit. This is followed by a decline in subsequent years: 5,690 million USD in 2022, 5,413 million USD in 2023, and further down to 5,235 million USD in 2024. Despite the decrease after 2021, the NOPAT values remain higher than the starting point in 2019, indicating a net improvement over the longer term.
- Overall Insights
- The comparison between net income and NOPAT reveals that while operating profitability experienced a pronounced peak in 2021, net income was highest in 2020 and showed more sustained growth in the latter years. The dip in both net income and NOPAT during 2021-2022 suggests external or internal factors affecting operational efficiency or market conditions during that period. The recovery in net income by 2023 and 2024 suggests successful adaptations or improvements, although NOPAT did not fully rebound to its peak levels. This indicates that while overall profitability has stabilized at a high level, operating profit margins may have tightened.
Cash Operating Taxes
Adobe Inc., cash operating taxes calculation
US$ in millions
Based on: 10-K (reporting date: 2024-11-29), 10-K (reporting date: 2023-12-01), 10-K (reporting date: 2022-12-02), 10-K (reporting date: 2021-12-03), 10-K (reporting date: 2020-11-27), 10-K (reporting date: 2019-11-29).
- Provision for (benefit from) income taxes
- The provision for income taxes exhibited notable fluctuations over the observed periods. Initially, in 2019, the provision was positive at 253 million USD. However, in 2020, there was a significant shift to a negative figure of -1084 million USD, indicating a tax benefit during that year. Following this, the provision returned to positive values, increasing to 883 million USD in 2021 and continuing to rise to 1252 million USD in 2022. The upward trend persisted in 2023 and 2024, stabilizing at 1371 million USD. This pattern suggests volatility in tax expenses or benefits, with a marked recovery and steady increase in tax provision in the latter years.
- Cash operating taxes
- Cash operating taxes have shown a consistent and robust upward trend throughout the entire period. Starting from 262 million USD in 2019, the figure increased substantially each year, reaching 435 million USD in 2020, then 710 million USD in 2021, and further rising to 943 million USD in 2022. The rate of increase accelerated in 2023 and 2024, with amounts jumping to 1761 and 1795 million USD respectively. This steady and significant growth in cash operating tax payments reflects increasing tax liabilities or higher cash outflows related to tax settlements over time.
Invested Capital
Adobe Inc., invested capital calculation (financing approach)
US$ in millions
Based on: 10-K (reporting date: 2024-11-29), 10-K (reporting date: 2023-12-01), 10-K (reporting date: 2022-12-02), 10-K (reporting date: 2021-12-03), 10-K (reporting date: 2020-11-27), 10-K (reporting date: 2019-11-29).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of deferred revenue.
5 Addition of equity equivalents to stockholders’ equity.
6 Removal of accumulated other comprehensive income.
7 Subtraction of capital projects in-progress.
8 Subtraction of short-term investments.
The financial data exhibits notable trends in Adobe Inc.'s debt, equity, and invested capital over the six-year span.
- Total reported debt & leases
- The reported debt and lease obligations demonstrated a slight downward trend from November 2019 to December 2023, decreasing from 4,736 million USD to 4,080 million USD. However, a significant increase is observed in November 2024, rising sharply to 6,056 million USD. This suggests a considerable increase in the company's leverage or lease commitments in the most recent year under review.
- Stockholders’ equity
- Stockholders’ equity showed a consistent upward trajectory from 10,530 million USD in November 2019, peaking at 16,518 million USD by December 2023. In the latest period, November 2024, equity declined to 14,105 million USD, indicating a reduction in net asset value available to shareholders after several years of growth.
- Invested capital
- Invested capital steadily increased from 17,466 million USD in November 2019 to a high point of 24,970 million USD in December 2023. The figure slightly declined to 24,709 million USD in November 2024, reflecting a marginal contraction of the total capital utilized in the business operations after a prolonged expansion phase.
Cost of Capital
Adobe Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt, including current portion3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2024-11-29).
1 US$ in millions
2 Equity. See details »
3 Debt, including current portion. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt, including current portion3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-12-01).
1 US$ in millions
2 Equity. See details »
3 Debt, including current portion. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt, including current portion3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-12-02).
1 US$ in millions
2 Equity. See details »
3 Debt, including current portion. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt, including current portion3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-12-03).
1 US$ in millions
2 Equity. See details »
3 Debt, including current portion. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt, including current portion3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-11-27).
1 US$ in millions
2 Equity. See details »
3 Debt, including current portion. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt, including current portion3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2019-11-29).
1 US$ in millions
2 Equity. See details »
3 Debt, including current portion. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Adobe Inc., economic spread ratio calculation, comparison to benchmarks
| Nov 29, 2024 | Dec 1, 2023 | Dec 2, 2022 | Dec 3, 2021 | Nov 27, 2020 | Nov 29, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Economic profit1 | |||||||
| Invested capital2 | |||||||
| Performance Ratio | |||||||
| Economic spread ratio3 | |||||||
| Benchmarks | |||||||
| Economic Spread Ratio, Competitors4 | |||||||
| Accenture PLC | |||||||
| Cadence Design Systems Inc. | |||||||
| CrowdStrike Holdings Inc. | |||||||
| Fair Isaac Corp. | |||||||
| International Business Machines Corp. | |||||||
| Intuit Inc. | |||||||
| Microsoft Corp. | |||||||
| Oracle Corp. | |||||||
| Palantir Technologies Inc. | |||||||
| Palo Alto Networks Inc. | |||||||
| Salesforce Inc. | |||||||
| ServiceNow Inc. | |||||||
| Synopsys Inc. | |||||||
| Workday Inc. | |||||||
Based on: 10-K (reporting date: 2024-11-29), 10-K (reporting date: 2023-12-01), 10-K (reporting date: 2022-12-02), 10-K (reporting date: 2021-12-03), 10-K (reporting date: 2020-11-27), 10-K (reporting date: 2019-11-29).
1 Economic profit. See details »
2 Invested capital. See details »
3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
Economic Profit Margin
Adobe Inc., economic profit margin calculation, comparison to benchmarks
| Nov 29, 2024 | Dec 1, 2023 | Dec 2, 2022 | Dec 3, 2021 | Nov 27, 2020 | Nov 29, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Economic profit1 | |||||||
| Revenue | |||||||
| Add: Increase (decrease) in deferred revenue | |||||||
| Adjusted revenue | |||||||
| Performance Ratio | |||||||
| Economic profit margin2 | |||||||
| Benchmarks | |||||||
| Economic Profit Margin, Competitors3 | |||||||
| Accenture PLC | |||||||
| Cadence Design Systems Inc. | |||||||
| CrowdStrike Holdings Inc. | |||||||
| Fair Isaac Corp. | |||||||
| International Business Machines Corp. | |||||||
| Intuit Inc. | |||||||
| Microsoft Corp. | |||||||
| Oracle Corp. | |||||||
| Palantir Technologies Inc. | |||||||
| Palo Alto Networks Inc. | |||||||
| Salesforce Inc. | |||||||
| ServiceNow Inc. | |||||||
| Synopsys Inc. | |||||||
| Workday Inc. | |||||||
Based on: 10-K (reporting date: 2024-11-29), 10-K (reporting date: 2023-12-01), 10-K (reporting date: 2022-12-02), 10-K (reporting date: 2021-12-03), 10-K (reporting date: 2020-11-27), 10-K (reporting date: 2019-11-29).
1 Economic profit. See details »
2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × ÷ =
3 Click competitor name to see calculations.