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Facebook Inc. (FB)

Return on Capital (ROC)

Difficulty: Advanced

Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.

Return on Invested Capital (ROIC)

Facebook Inc., ROIC calculation

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (USD $ in millions)
Net operating profit after taxes (NOPAT)1 21,981  15,406  9,712  2,936  2,748 
Invested capital2 60,354  41,602  38,727  31,660  30,548 
Ratio
ROIC3 36.42% 37.03% 25.08% 9.27% 9.00%

Based on: 10-K (filing date: 2019-01-31), 10-K (filing date: 2018-02-01), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-01-28), 10-K (filing date: 2015-01-29).

2018 Calculations

1 NOPAT. See Details »

2 Invested capital. See Details »

3 ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 21,981 ÷ 60,354 = 36.42%

Ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. Facebook Inc.’s ROIC improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.