.Profitability Analysis
Difficulty: Beginner
Profitability ratios measure the company's ability to generate profitable sales from its resources (assets).
Ratios (Summary)
Apple Inc., profitability ratios
| Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | ||
|---|---|---|---|---|---|---|---|
| Return on Sales | |||||||
| | Gross profit margin | % | % | % | % | % | % |
| | Operating profit margin | % | % | % | % | % | % |
| | Net profit margin | % | % | % | % | % | % |
| Return on Investment | |||||||
| | Return on equity (ROE) | % | % | % | % | % | % |
| | Return on assets (ROA) | % | % | % | % | % | % |
Source: Based on data from Apple Inc. Annual Reports
| Ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Apple Inc.'s gross profit margin deteriorated from 2015 to 2016 and from 2016 to 2017. |
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Apple Inc.'s operating profit margin deteriorated from 2015 to 2016 and from 2016 to 2017. |
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Apple Inc.'s net profit margin deteriorated from 2015 to 2016 and from 2016 to 2017. |
| ROE | A profitability ratio calculated as net income divided by shareholders' equity. | Apple Inc.'s ROE deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
| ROA | A profitability ratio calculated as net income divided by total assets. | Apple Inc.'s ROA deteriorated from 2015 to 2016 and from 2016 to 2017. |
Gross Profit Margin
Apple Inc., gross profit margin calculation
| Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | |||||||
| | Gross margin | ||||||
| | Net sales | ||||||
| Ratio | |||||||
| | Gross profit margin1 | % | % | % | % | % | % |
| Benchmarks | |||||||
| Gross Profit Margin, Competitors | |||||||
| Applied Materials Inc. | % | % | % | % | % | % | |
| Broadcom Ltd. | % | % | % | % | % | % | |
| Cisco Systems Inc. | % | % | % | % | % | % | |
| HP Inc. | % | % | % | % | % | % | |
| Intel Corp. | % | % | % | % | % | % | |
| NVIDIA Corp. | % | % | % | % | % | % | |
| Qualcomm Inc. | % | % | % | % | % | % | |
| Texas Instruments Inc. | % | % | % | % | % | % | |
Source: Based on data from Apple Inc. Annual Reports
2017 Calculations
1 Gross profit margin = 100 × Gross margin ÷ Net sales
= 100 × ÷ = %
| Ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Apple Inc.'s gross profit margin deteriorated from 2015 to 2016 and from 2016 to 2017. |
Operating Profit Margin
Apple Inc., operating profit margin calculation, comparison to benchmarks
| Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | |||||||
| | Operating income | ||||||
| | Net sales | ||||||
| Ratio | |||||||
| | Operating profit margin1 | % | % | % | % | % | % |
| Benchmarks | |||||||
| Operating Profit Margin, Competitors | |||||||
| Applied Materials Inc. | % | % | % | % | % | % | |
| Broadcom Ltd. | % | % | % | % | % | % | |
| Cisco Systems Inc. | % | % | % | % | % | % | |
| HP Inc. | % | % | % | % | % | % | |
| Intel Corp. | % | % | % | % | % | % | |
| NVIDIA Corp. | % | % | % | % | % | % | |
| Qualcomm Inc. | % | % | % | % | % | % | |
| Texas Instruments Inc. | % | % | % | % | % | % | |
| Operating Profit Margin, Sector | |||||||
| Technology Hardware & Equipment | % | % | % | % | % | % | |
| Operating Profit Margin, Industry | |||||||
| Technology | % | % | % | % | % | % | |
Source: Based on data from Apple Inc. Annual Reports
2017 Calculations
1 Operating profit margin = 100 × Operating income ÷ Net sales
= 100 × ÷ = %
| Ratio | Description | The company |
|---|---|---|
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Apple Inc.'s operating profit margin deteriorated from 2015 to 2016 and from 2016 to 2017. |
Net Profit Margin
Apple Inc., net profit margin calculation, comparison to benchmarks
| Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | |||||||
| | Net income | ||||||
| | Net sales | ||||||
| Ratio | |||||||
| | Net profit margin1 | % | % | % | % | % | % |
| Benchmarks | |||||||
| Net Profit Margin, Competitors | |||||||
| Applied Materials Inc. | % | % | % | % | % | % | |
| Broadcom Ltd. | % | % | % | % | % | % | |
| Cisco Systems Inc. | % | % | % | % | % | % | |
| HP Inc. | % | % | % | % | % | % | |
| Intel Corp. | % | % | % | % | % | % | |
| NVIDIA Corp. | % | % | % | % | % | % | |
| Qualcomm Inc. | % | % | % | % | % | % | |
| Texas Instruments Inc. | % | % | % | % | % | % | |
| Net Profit Margin, Sector | |||||||
| Technology Hardware & Equipment | % | % | % | % | % | % | |
| Net Profit Margin, Industry | |||||||
| Technology | % | % | % | % | % | % | |
Source: Based on data from Apple Inc. Annual Reports
2017 Calculations
1 Net profit margin = 100 × Net income ÷ Net sales
= 100 × ÷ = %
| Ratio | Description | The company |
|---|---|---|
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Apple Inc.'s net profit margin deteriorated from 2015 to 2016 and from 2016 to 2017. |
Return on Equity (ROE)
Apple Inc., ROE calculation, comparison to benchmarks
| Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | |||||||
| | Net income | ||||||
| | Shareholders' equity | ||||||
| Ratio | |||||||
| | ROE1 | % | % | % | % | % | % |
| Benchmarks | |||||||
| ROE, Competitors | |||||||
| Applied Materials Inc. | % | % | % | % | % | % | |
| Broadcom Ltd. | % | % | % | % | % | % | |
| Cisco Systems Inc. | % | % | % | % | % | % | |
| HP Inc. | % | % | % | % | % | % | |
| Intel Corp. | % | % | % | % | % | % | |
| NVIDIA Corp. | % | % | % | % | % | % | |
| Qualcomm Inc. | % | % | % | % | % | % | |
| Texas Instruments Inc. | % | % | % | % | % | % | |
| ROE, Sector | |||||||
| Technology Hardware & Equipment | % | % | % | % | % | % | |
| ROE, Industry | |||||||
| Technology | % | % | % | % | % | % | |
Source: Based on data from Apple Inc. Annual Reports
2017 Calculations
1 ROE = 100 × Net income ÷ Shareholders' equity
= 100 × ÷ = %
| Ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders' equity. | Apple Inc.'s ROE deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
Return on Assets (ROA)
Apple Inc., ROA calculation, comparison to benchmarks
| Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | |||||||
| | Net income | ||||||
| | Total assets | ||||||
| Ratio | |||||||
| | ROA1 | % | % | % | % | % | % |
| Benchmarks | |||||||
| ROA, Competitors | |||||||
| Applied Materials Inc. | % | % | % | % | % | % | |
| Broadcom Ltd. | % | % | % | % | % | % | |
| Cisco Systems Inc. | % | % | % | % | % | % | |
| HP Inc. | % | % | % | % | % | % | |
| Intel Corp. | % | % | % | % | % | % | |
| NVIDIA Corp. | % | % | % | % | % | % | |
| Qualcomm Inc. | % | % | % | % | % | % | |
| Texas Instruments Inc. | % | % | % | % | % | % | |
| ROA, Sector | |||||||
| Technology Hardware & Equipment | % | % | % | % | % | % | |
| ROA, Industry | |||||||
| Technology | % | % | % | % | % | % | |
Source: Based on data from Apple Inc. Annual Reports
2017 Calculations
1 ROA = 100 × Net income ÷ Total assets
= 100 × ÷ = %
| Ratio | Description | The company |
|---|---|---|
| ROA | A profitability ratio calculated as net income divided by total assets. | Apple Inc.'s ROA deteriorated from 2015 to 2016 and from 2016 to 2017. |
