Amgen Inc. (NASDAQ:AMGN)

Return on Assets (ROA)

The Return on Assets exhibits a fluctuating trend over the observed periods. Starting at 11.33% in March 2021, it declines to a low of 3.44% in June 2024 before recovering moderately to 7.53% by June 2025. The initial decline through 2023 suggests decreasing efficiency in asset utilization. The subsequent rise in 2024 and 2025 indicates an improvement in generating profit from assets after a period of reduced returns.

Financial Leverage

Financial leverage shows considerable volatility. Beginning at a ratio of 6.7 in March 2021, it spikes dramatically to 64.62 by March 2022, then declines steadily to 11.83 by June 2025. This peak suggests a substantial increase in debt relative to equity or assets during early 2022, possibly reflecting strategic financing decisions or market conditions. The subsequent downward trend reflects deleveraging efforts or improved equity positions over the latter periods.

Return on Equity (ROE)

Return on Equity follows a pattern similar to financial leverage but with far more pronounced changes. It starts at 75.91% in March 2021 and reaches an extraordinary peak of 624.78% in March 2022, followed by a sharp decrease to approximately 52.83% in June 2024. It then rises again, reaching 89.11% by June 2025. The extreme peak around early 2022 likely corresponds with the peak in financial leverage, indicating that increased leverage has amplified returns to equity holders during that period. The subsequent decrease may reflect deleveraging or normalized earning capacity. The partial recovery in 2024 and 2025 suggests a stabilized profit generation for shareholders.

Interrelationships and Insights

The data reflect a strong correlation between financial leverage and return on equity, where increased leverage magnifies returns to equity holders. The initial surge in leverage and ROE in early 2022 indicates a strategic use of debt to enhance equity returns, though with associated increased risk. The fall in ROA during the same period implies that asset profitability did not increase proportionally and that the high ROE was largely driven by leverage rather than improved operational efficiency. The subsequent periods show a corrective trend, with reduced leverage and a stabilization of both ROA and ROE, suggesting a rebalancing of the capital structure and improved asset utilization efficiency.

The financial data reveals several notable trends across key performance indicators over the observed quarters. Each metric presents a pattern of fluctuation that provides insight into operational efficiency, leverage management, and profitability dynamics.

Net Profit Margin (%)

The net profit margin demonstrates a moderately volatile trend with values ranging from approximately 10.6% to 31.77%. Early periods show a decline from about 29.6% to mid-20% range, followed by a notable rebound reaching near 32% in 2023. Subsequently, a sharp decline occurs in 2024, reaching lows near 10.6%, before beginning a gradual recovery towards 19.75% by mid-2025. This pattern indicates fluctuations in profitability relative to revenues, which could be influenced by changing cost structures or revenue mix.

Asset Turnover (ratio)

Asset turnover remains relatively stable throughout the periods with values mostly oscillating between 0.28 and 0.41. A noticeable dip to 0.28 occurs in early 2023 and persists for several quarters, followed by a gradual recovery back up to 0.38 by mid-2025. The stability suggests consistent efficiency in generating sales from asset investments despite some short-term decreases in efficiency.

Financial Leverage (ratio)

Financial leverage exhibits significant volatility, with exceptionally high values observed in the early 2022 quarter (up to 64.62), followed by a marked decrease and stabilization in subsequent quarters. After the spike, leverage decreases steadily to levels between approximately 11.83 and 18.51, which still show variability but much less extreme. This spike and subsequent decline suggest a major change in the firm's capital structure or balance sheet composition during early 2022, with the firm reducing relatively high leverage over time.

Return on Equity (ROE) (%)

ROE follows a pattern similar to financial leverage, with extremely high values recorded in early 2022 (exceeding 600%), followed by a consistent decline through subsequent quarters. Although the values decrease significantly after the spike, ROE remains elevated compared to earlier periods, ranging from approximately 52.83% to 148.04% after the spike, then settling near 89.11% by mid-2025. The movement indicates that while profitability to shareholders’ equity was extraordinarily high at one point—likely due to leverage effects—the underlying return performance stabilizes at a high level in later periods.

Overall, the data reflects a period marked by an abnormal increase in financial leverage and related profitability measures around early 2022, suggesting a potentially significant financing event or accounting change. Subsequent quarters show gradual normalization of leverage accompanied by more stable profitability and efficiency metrics. The net profit margin's volatility indicates possible fluctuations in operational performance or market conditions affecting profit generation independent of asset utilization. Meanwhile, asset turnover remains relatively steady, underscoring consistent asset use efficiency despite external or internal shifts impacting profitability and capital structure.

Tax Burden

The tax burden ratio remained relatively stable over the observed periods, fluctuating marginally between 0.86 and 0.9. This indicates a consistent proportion of earnings retained after tax expenses, suggesting stable tax efficiency.

Interest Burden

The interest burden ratio exhibited a gradual downward trend from 0.87 in early 2021 to a low of 0.52 in mid-2024, followed by a slight recovery towards 0.72 by mid-2025. This pattern reflects an increasing impact of interest expenses on earnings before taxes during the middle of the timeline, with some alleviation in the most recent quarters.

EBIT Margin

The EBIT margin showed variability, beginning at 38.31% in the first quarter of 2021 and generally declining towards 22.81% by mid-2024. Thereafter, it demonstrated signs of recovery, rising to approximately 30.93% by mid-2025. These fluctuations denote periods of both deteriorating and improving operational profitability across the timeline.

Asset Turnover

Asset turnover hovered around 0.37 to 0.41 during 2021 and early 2022, indicating steady efficiency in asset utilization for revenue generation. A notable decline to 0.28 occurred in 2023, persisting for several quarters, followed by gradual improvement back to 0.38 by mid-2025. This suggests a temporary reduction in asset efficiency with a recovery trend emerging later.

Financial Leverage

Financial leverage ratios displayed substantial volatility, beginning at around 6.7 in early 2021 and spiking sharply to an extraordinarily high level of 64.62 in the first quarter of 2022. This peak was followed by a decline and ongoing fluctuations ranging roughly between 11.83 and 18.51 up to mid-2025. Such variation indicates significant changes in the use of debt relative to equity, with potential implications for financial risk profiles.

Return on Equity (ROE)

ROE exhibited extreme spikes during early 2022, reaching 624.78%, before declining steadily to about 52.83% by mid-2024. Subsequently, it climbed again to 95.59% by late 2024 and slightly decreased to 89.11% by mid-2025. These dramatic changes largely reflect the combined effects of volatility in financial leverage, interest burden, and profitability metrics, resulting in highly variable returns to shareholders.

Net Profit Margin

The net profit margin exhibits a fluctuating trend over the observed periods. Initially, it starts at a relatively high level of 29.6% and experiences a decline through 2021 to around the mid-20% range. It then recovers somewhat entering 2023, reaching a peak near 31.77% before declining sharply in early 2024 to a low of approximately 10.6%. Following this trough, the margin gradually improves toward mid-2025, ending at about 19.75%. This pattern suggests periods of profitability volatility, with a notable dip in early 2024 indicating possible increased costs or pricing pressure during that time.

Asset Turnover

Asset turnover ratios remain relatively stable with minor variations over the entire timeframe. The ratio fluctuates slightly around 0.38 to 0.41 in the earlier years through 2022. Beginning in 2023, there is a noticeable decline to approximately 0.28 that remains consistent through the end of 2023. Thereafter, a gradual improvement is visible, increasing to 0.38 by mid-2025. This stability coupled with the mid-period dip could indicate changes in asset utilization efficiency, with some challenges encountered in 2023 before recovery efforts took hold.

Return on Assets (ROA)

Return on assets follows a downward trend from 2021 through 2024, starting around 11.33% and declining to a low of 3.44% in mid-2024. Post this low point, ROA gradually rebounds, reaching 7.53% by mid-2025. The decline is indicative of reduced overall profitability relative to assets during the period, potentially related to the same factors impacting profit margins and asset turnover. The eventual recovery in ROA suggests improving operational performance or better asset management in the latter periods.

The analysis of the quarterly financial data reveals several notable trends in the company’s financial performance over the observed periods.

Tax Burden

The tax burden ratio remains relatively stable, fluctuating narrowly between 0.86 and 0.90 throughout the periods. This stability suggests consistent tax expense relative to earnings before tax, indicating no significant changes in tax policy or extraordinary tax events.

Interest Burden

The interest burden ratio displays a gradual decline from 0.87 in early 2021 to a trough around the third quarter of 2023 at 0.52, followed by a recovery upwards to 0.72 by mid-2025. This pattern suggests an increasing interest expense burden or financial leverage during the mid-period, with some easing of this burden in later periods.

EBIT Margin

The EBIT margin percentage shows considerable volatility. Initially, it moves around the low 30s percentage range, rises notably to a peak over 44% in 2023's third quarter, and then declines sharply to below 23% by mid-2024. A moderate recovery up to about 31% is seen by mid-2025. These fluctuations may reflect changes in operating efficiency, cost management, or business conditions affecting profitability before interest and taxes.

Asset Turnover

Asset turnover begins near 0.38-0.41, indicating moderate efficiency in using assets to generate revenues. It declines sharply to about 0.28 by early 2023, then progressively improves again towards 0.38 by mid-2025. This suggests a temporary reduction in operational efficiency or asset utilization, with a gradual return to previous efficiency levels.

Return on Assets (ROA)

The ROA metric aligns with the trends in EBIT margin and asset turnover, exhibiting a peak above 11% in mid-2022, followed by a decline to around 3.44% in mid-2024, and a subsequent recovery up to 7.53% by mid-2025. This indicates that overall profitability relative to assets weakened significantly before starting to improve again.

In summary, the company experienced a period of fluctuating operational profitability and changing efficiency in asset utilization. Notably, after mid-2023, there was a decline in key margin and profitability metrics, along with reduced asset turnover, indicating challenges in operational performance or market conditions. Financial burden from interest showed a marked increase during the mid-period but lessened later. Toward the end of the period, signs of recovery in operational efficiency and profitability emerge, though metrics have not yet fully returned to earlier highs. The tax burden remained steady across the entire timeframe.

The financial data reveals several noteworthy trends and fluctuations across the analyzed periods. Each key financial indicator exhibits distinct patterns that suggest changes in operational efficiency, profitability, and financial burdens.

Tax Burden

The tax burden ratio remains relatively stable throughout the periods, fluctuating narrowly between 0.86 and 0.90. This consistency indicates that the company's effective tax rate did not experience significant changes over time, suggesting stable tax management or policy environment.

Interest Burden

A declining trend is evident in the interest burden ratio from early 2021 through mid-2024, dropping from 0.87 to a low of 0.52. This decline reflects an increasing interest expense relative to earnings before interest and taxes, indicating either greater debt levels or rising borrowing costs during this period. However, from mid-2024 onwards, the interest burden ratio shows a partial recovery, rising to 0.72 by mid-2025, which may suggest improved interest coverage or decreased interest expenses in the latter periods.

EBIT Margin

The EBIT margin demonstrates notable volatility across quarters. Initially ranging around the low 30% levels in 2021, it sees a substantial increase reaching above 43% in early 2023, indicating improved operating profitability during that time. Following this, there is a marked decline through 2023 into 2024, dropping to a low near 22.81%. A moderate recovery is visible toward mid-2025, with EBIT margins climbing back to approximately 30.93%. This cyclical pattern suggests periods of operational challenges or margin pressure, possibly due to changes in costs, pricing power, or sales mix.

Net Profit Margin

Net profit margin trends mirror those of EBIT margin with some lag. Starting around 29.6% in early 2021, net margins declined to a low near 23% by the end of 2021 and showed improvement reaching peaks above 31% in early 2023. Subsequently, margins declined quite sharply to levels near 10.6% in mid-2024, indicating a significant decrease in overall profitability. A partial rebound is observed by mid-2025 where the net margin rises to about 19.75%, though it remains well below previous peaks. Such fluctuations indicate changing bottom-line profitability potentially influenced by higher interest expenses, taxes, or operational costs impacting net earnings.

In summary, the company experiences steady tax burdens but faces increasing interest expenses until mid-2024, impacting profitability metrics. EBIT and net profit margins display significant volatility with strong peaks in early 2023, followed by substantial declines and partial recoveries. These dynamics suggest that financial performance is sensitive to changes in operating efficiency, cost structure, and financing costs over the observed periods.