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.
Economic Profit
Intel Corp., economic profit calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
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
= -13,095 – 11.48% × 92,296 = -23,693
- Net Operating Profit After Taxes (NOPAT)
- There is a noticeable decline in NOPAT over the five-year period. Starting at 22,960 million US dollars in 2020, it decreased to 19,493 million in 2021, followed by a sharp drop to 3,672 million in 2022. The negative figures in 2023 and 2024, at -1,469 million and -13,095 million respectively, indicate a significant deterioration in operational profitability.
- Cost of Capital
- The cost of capital shows a moderate downward trend, beginning at 13.46% in 2020 and gradually decreasing to 11.48% by 2024. This suggests a slight reduction in the expected return rate required by investors over time.
- Invested Capital
- Invested capital increased steadily from 81,967 million US dollars in 2020 to 92,296 million in 2024. This consistent rise reflects ongoing capital deployment into the company's operations or assets.
- Economic Profit
- Economic profit exhibits a significant negative trend. Initially positive at 11,930 million in 2020, it declines to 7,900 million in 2021, then turns negative in 2022 with -7,223 million. The negative values deepen in subsequent years, reaching -23,693 million in 2024. This decline indicates that the company's returns are increasingly failing to cover its cost of capital, resulting in value destruction.
Net Operating Profit after Taxes (NOPAT)
Intel Corp., NOPAT calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in accrued restructuring balance.
3 Addition of increase (decrease) in equity equivalents to net income (loss) attributable to Intel.
4 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 460 × 4.90% = 23
5 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 1,057 × 21.00% = 222
6 Addition of after taxes interest expense to net income (loss) attributable to Intel.
7 2024 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 1,245 × 21.00% = 261
8 Elimination of after taxes investment income.
- Net Income (Loss) Attributable to Intel
- The net income attributable to the company demonstrates a declining trend over the observed five-year period. In 2020, net income was robust at 20,899 million US dollars, followed by a slight decline to 19,868 million in 2021. Subsequently, the net income sharply decreased to 8,014 million in 2022 and further declined to a marginal 1,689 million in 2023. The latest period, 2024, shows a significant shift with a reported net loss of 18,756 million US dollars, indicating considerable financial challenges during this year.
- Net Operating Profit After Taxes (NOPAT)
- The NOPAT values depict a similar downward trajectory over the same timeline. The highest NOPAT figure was recorded in 2020 at 22,960 million US dollars. This declined moderately to 19,493 million in 2021, followed by a steeper drop to 3,672 million in 2022. In 2023, the company reported a negative NOPAT of 1,469 million, which further deteriorated to a negative 13,095 million in 2024. This trend points to declining operational profitability and indicates increasing operational inefficiencies or challenges.
- Overall Analysis
- Both net income and NOPAT exhibit a consistent decline throughout the period, culminating in losses by 2024. The transition from substantial profits in earlier years to losses in recent years suggests significant adverse developments in the company's financial performance. The negative figures in both metrics for the last two years highlight deteriorating profitability and may reflect increased costs, reduced revenues, or other operational difficulties. The gap between net income and NOPAT remains relatively consistent in direction, affirming that operating profitability issues are a key factor in the overall financial decline.
Cash Operating Taxes
Intel Corp., cash operating taxes calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
The financial data reveals notable fluctuations in tax-related figures over the five-year period from 2020 to 2024. Two primary tax metrics are observed: the provision for (benefit from) taxes and cash operating taxes, both measured in millions of U.S. dollars.
- Provision for (benefit from) taxes
- In 2020, the provision was a positive value of $4,179 million, indicating a tax expense. This figure decreased significantly to $1,835 million in 2021, suggesting a reduction in tax expense. In the subsequent years, the provision turned negative, at -$249 million in 2022 and further to -$913 million in 2023, which reflects a tax benefit (or potential tax credits/refunds) recognized by the company during these periods. However, in 2024, there is a sharp reversal, with the provision rising dramatically to $8,023 million, representing a substantial tax expense increase compared to previous years.
- Cash operating taxes
- Cash operating taxes demonstrated a steady increase from $2,488 million in 2020 to $2,675 million in 2021. This upward trend accelerated in 2022, reaching $4,893 million, which is a significant increase. However, the amount decreased substantially in 2023 to $1,005 million, before rising again in 2024 to $1,916 million. These movements suggest variability in the actual cash taxes paid, which do not exactly mirror the trends observed in the provision for taxes. The divergence between provision and cash taxes particularly in 2022 and 2023 highlights potential timing differences or adjustments related to deferred tax assets/liabilities or tax planning strategies.
Overall, the data indicates volatility in tax expense recognition and cash taxes paid across the five years. The negative provisions in 2022 and 2023 contrast with the cash taxes paid, implying tax benefits recorded in the accounts that did not translate immediately into cash savings. The sharp increase in provision in 2024, alongside rising cash tax payments, may reflect changes in tax regulations, adjustments, or an increase in taxable income. The inconsistencies between provision and cash taxes underscore complexities in the tax treatment and possibly strategic tax management during this period.
Invested Capital
Intel Corp., invested capital calculation (financing approach)
US$ in millions
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of accrued restructuring balance.
4 Addition of equity equivalents to total Intel stockholders’ equity.
5 Removal of accumulated other comprehensive income.
6 Subtraction of construction in progress.
7 Subtraction of marketable securities.
The financial data reveals several key trends pertaining to the company's debt, equity, and invested capital over the five-year period from 2020 to 2024.
- Total reported debt & leases
- This metric shows a consistent upward trend throughout the period. Starting at 36,928 million USD in 2020, it increased annually, reaching 50,471 million USD by 2024. The growth rate appears to accelerate particularly between 2022 and 2023, indicating increased leverage or obligations in recent years.
- Total Intel stockholders’ equity
- Stockholders’ equity also trended upward from 81,038 million USD in 2020 to a peak of 105,590 million USD in 2023. However, there is a noticeable decline in 2024, where equity decreased to 99,270 million USD. This dip after steady growth may suggest changes in retained earnings, dividend payments, share buybacks, or other equity-related activities impacting shareholders' net assets.
- Invested capital
- Invested capital rose more moderately compared to debt and equity. It increased from 81,967 million USD in 2020 to 92,296 million USD in 2024. While the upward movement is steady, the increments between years are smaller, and the curve flattens especially between 2022 and 2024, indicating stability or slower growth in capital investments relative to debt expansion.
In summary, the company's debt obligations have increased significantly, suggesting higher leverage or financing activities. While stockholders’ equity showed robust growth until 2023, a decline in 2024 raises questions about changes in capital structure or profitability. Invested capital growth is present but more restrained, reflecting cautious or stable investment in assets. These patterns collectively highlight a shift towards increased debt financing with potential impacts on shareholder value and capital deployment strategies.
Cost of Capital
Intel Corp., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 84,132) | 84,132) | ÷ | 128,092) | = | 0.66 | 0.66 | × | 15.48% | = | 10.16% | ||
| Debt3 | 43,500) | 43,500) | ÷ | 128,092) | = | 0.34 | 0.34 | × | 4.86% × (1 – 21.00%) | = | 1.30% | ||
| Operating lease liability4 | 460) | 460) | ÷ | 128,092) | = | 0.00 | 0.00 | × | 4.90% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 128,092) | 1.00 | 11.48% | ||||||||||
Based on: 10-K (reporting date: 2024-12-28).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 184,552) | 184,552) | ÷ | 232,583) | = | 0.79 | 0.79 | × | 15.48% | = | 12.28% | ||
| Debt3 | 47,600) | 47,600) | ÷ | 232,583) | = | 0.20 | 0.20 | × | 4.72% × (1 – 21.00%) | = | 0.76% | ||
| Operating lease liability4 | 431) | 431) | ÷ | 232,583) | = | 0.00 | 0.00 | × | 5.00% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 232,583) | 1.00 | 13.05% | ||||||||||
Based on: 10-K (reporting date: 2023-12-30).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 116,498) | 116,498) | ÷ | 155,151) | = | 0.75 | 0.75 | × | 15.48% | = | 11.62% | ||
| Debt3 | 38,244) | 38,244) | ÷ | 155,151) | = | 0.25 | 0.25 | × | 3.38% × (1 – 21.00%) | = | 0.66% | ||
| Operating lease liability4 | 409) | 409) | ÷ | 155,151) | = | 0.00 | 0.00 | × | 4.30% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 155,151) | 1.00 | 12.29% | ||||||||||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 195,660) | 195,660) | ÷ | 237,635) | = | 0.82 | 0.82 | × | 15.48% | = | 12.74% | ||
| Debt3 | 41,500) | 41,500) | ÷ | 237,635) | = | 0.17 | 0.17 | × | 2.57% × (1 – 21.00%) | = | 0.35% | ||
| Operating lease liability4 | 475) | 475) | ÷ | 237,635) | = | 0.00 | 0.00 | × | 2.50% × (1 – 21.00%) | = | 0.00% | ||
| Total: | 237,635) | 1.00 | 13.10% | ||||||||||
Based on: 10-K (reporting date: 2021-12-25).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 230,210) | 230,210) | ÷ | 271,637) | = | 0.85 | 0.85 | × | 15.48% | = | 13.12% | ||
| Debt3 | 40,900) | 40,900) | ÷ | 271,637) | = | 0.15 | 0.15 | × | 2.84% × (1 – 21.00%) | = | 0.34% | ||
| Operating lease liability4 | 527) | 527) | ÷ | 271,637) | = | 0.00 | 0.00 | × | 2.50% × (1 – 21.00%) | = | 0.00% | ||
| Total: | 271,637) | 1.00 | 13.46% | ||||||||||
Based on: 10-K (reporting date: 2020-12-26).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Intel Corp., economic spread ratio calculation, comparison to benchmarks
| Dec 28, 2024 | Dec 30, 2023 | Dec 31, 2022 | Dec 25, 2021 | Dec 26, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | (23,693) | (13,487) | (7,223) | 7,900) | 11,930) | |
| Invested capital2 | 92,296) | 92,095) | 88,671) | 88,498) | 81,967) | |
| Performance Ratio | ||||||
| Economic spread ratio3 | -25.67% | -14.65% | -8.15% | 8.93% | 14.55% | |
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Advanced Micro Devices Inc. | -19.96% | -21.38% | -21.08% | 35.62% | 9.37% | |
| Analog Devices Inc. | -12.33% | -8.24% | -9.61% | -12.86% | -7.87% | |
| Applied Materials Inc. | 8.97% | 16.88% | 26.79% | 22.30% | 10.53% | |
| Broadcom Inc. | -7.39% | 7.84% | 6.39% | -2.93% | -8.37% | |
| KLA Corp. | 20.51% | 24.38% | 26.65% | 15.28% | 4.16% | |
| Lam Research Corp. | 2.62% | 7.93% | 22.84% | 18.20% | 2.32% | |
| Micron Technology Inc. | -15.35% | -27.41% | 0.34% | -4.22% | -9.75% | |
| NVIDIA Corp. | 67.71% | -10.45% | 31.75% | 12.19% | -1.82% | |
| Qualcomm Inc. | 10.37% | 2.80% | 29.24% | 26.64% | 11.69% | |
| Texas Instruments Inc. | 5.63% | 15.26% | 35.92% | 34.53% | 29.68% | |
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
1 Economic profit. See details »
2 Invested capital. See details »
3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × -23,693 ÷ 92,296 = -25.67%
4 Click competitor name to see calculations.
The financial data indicates a significant downward trend in economic profit over the analyzed periods. Starting with a positive economic profit of $11,930 million in 2020, the figure decreases substantially to $7,900 million in 2021, followed by a transition into negative territory from 2022 onward. The negative values deepen each year, reaching -$7,223 million in 2022, -$13,487 million in 2023, and further declining to -$23,693 million in 2024. This trajectory suggests increasing challenges in generating economic value beyond capital costs.
Invested capital demonstrates a steady increase throughout the same timeframe. Beginning at $81,967 million in 2020, the figure rises incrementally each year, reaching $88,498 million in 2021, $88,671 million in 2022, $92,095 million in 2023, and $92,296 million in 2024. This steady growth in invested capital implies ongoing investments or asset accumulation, despite the declining returns observed in economic profit.
The economic spread ratio parallels the trend in economic profit, showcasing a decline from a positive 14.55% in 2020 to 8.93% in 2021, then turning negative in 2022 at -8.15%. The ratio worsens through subsequent years with -14.65% in 2023 and further down to -25.67% in 2024. This decline in economic spread ratio highlights a diminishing return on invested capital relative to the cost of capital, aligning with the observed negative economic profit figures.
Overall, the data reflects a period of deteriorating profitability in economic terms, despite the gradual growth of invested capital. The consistent decrease in economic spread ratio underlines a worsening ability to generate returns above the capital’s cost, signaling potential challenges in operational efficiency or market conditions affecting profitability. The increasing invested capital alongside declining economic returns may warrant a careful reassessment of investment strategies and resource allocation going forward.
Economic Profit Margin
Intel Corp., economic profit margin calculation, comparison to benchmarks
| Dec 28, 2024 | Dec 30, 2023 | Dec 31, 2022 | Dec 25, 2021 | Dec 26, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | (23,693) | (13,487) | (7,223) | 7,900) | 11,930) | |
| Net revenue | 53,101) | 54,228) | 63,054) | 79,024) | 77,867) | |
| Performance Ratio | ||||||
| Economic profit margin2 | -44.62% | -24.87% | -11.45% | 10.00% | 15.32% | |
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Advanced Micro Devices Inc. | -45.07% | -54.58% | -52.27% | 13.43% | 4.19% | |
| Analog Devices Inc. | -56.91% | -29.60% | -36.00% | -82.65% | -25.58% | |
| Applied Materials Inc. | 7.31% | 11.32% | 15.47% | 14.23% | 8.02% | |
| Broadcom Inc. | -20.19% | 13.72% | 11.95% | -6.89% | -23.08% | |
| KLA Corp. | 17.60% | 19.36% | 22.53% | 15.06% | 4.66% | |
| Lam Research Corp. | 2.65% | 6.96% | 16.85% | 14.68% | 2.70% | |
| Micron Technology Inc. | -32.60% | -94.30% | 0.58% | -7.07% | -19.25% | |
| NVIDIA Corp. | 34.19% | -8.27% | 21.28% | 9.53% | -2.36% | |
| Qualcomm Inc. | 8.22% | 2.46% | 19.47% | 16.05% | 8.82% | |
| Texas Instruments Inc. | 9.42% | 19.68% | 31.50% | 30.89% | 26.61% | |
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
1 Economic profit. See details »
2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Net revenue
= 100 × -23,693 ÷ 53,101 = -44.62%
3 Click competitor name to see calculations.
The data reveals a downward trajectory in key financial metrics over the five-year period under review.
- Economic Profit
- There is a noteworthy decline in economic profit, starting at $11,930 million in 2020 and decreasing to $7,900 million in 2021. From 2022 onwards, economic profit turned negative, reaching -$7,223 million in 2022 and further declining to -$23,693 million by 2024. This indicates deteriorating profitability beyond accounting measures, suggesting rising costs or diminishing return on invested capital.
- Net Revenue
- Net revenue experienced a moderate increase from $77,867 million in 2020 to $79,024 million in 2021. However, starting in 2022, revenue sharply declined to $63,054 million, continuing downward to $53,101 million by the end of 2024. The consistent revenue drop points to weakening sales or lower market demand.
- Economic Profit Margin
- The economic profit margin also depicts a declining trend, moving from a strong positive margin of 15.32% in 2020 to 10% in 2021. The margin then turns negative in 2022 at -11.45% and worsens to -44.62% by 2024. A negative economic profit margin suggests that the firm is not generating sufficient returns relative to its capital costs, reflecting inefficiency or adverse market conditions.
Overall, the firm shows significant financial challenges marked by decreasing revenues compounded by worsening profitability and economic profit margins. These trends imply operational or strategic issues that may require corrective measures to restore positive value creation.