Intel Corp. (NASDAQ:INTC)

The financial data reveals several notable trends regarding profitability, capital investment, and economic profit over the five-year period analyzed.

Net Operating Profit After Taxes (NOPAT)

The net operating profit after taxes shows a declining trend overall. Starting at a high point of $22,960 million in 2020, it decreased moderately to $19,493 million in 2021, followed by a significant drop to $3,672 million in 2022. The figures then turned negative in 2023 with -$1,469 million and further declined to -$13,095 million in 2024, indicating operational challenges and losses over the last two years.

Cost of Capital

The cost of capital exhibits a slight downward trend from 13.67% in 2020 to 11.65% in 2024, despite some fluctuations. This decrease may suggest improvements in financing costs or changes in the company's risk profile during the period.

Invested Capital

Invested capital consistently increased over the five years, rising from $81,967 million in 2020 to $92,296 million in 2024. This steady increase indicates ongoing investments in assets or expansion efforts irrespective of profitability performance.

Economic Profit

Economic profit follows a sharply negative trajectory after 2021. Initially positive at $11,754 million in 2020 and $7,715 million in 2021, economic profit turned negative beginning in 2022 with a loss of $7,392 million, worsening in subsequent years to losses of $13,673 million (2023) and $23,846 million (2024). This trend reflects that the returns generated have fallen below the cost of capital, signaling value destruction during this period.

In summary, the period examined demonstrates declining profitability culminating in losses, alongside a consistent rise in invested capital and a reduced cost of capital. The increasing economic losses highlight challenges in achieving returns above the cost of capital, indicating pressing financial and operational issues during the latter part of the timeline.

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.

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.

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.

The financial data reveals a significant downward trend in economic profit over the observed five-year period. Initially, economic profit stood at a positive level of 11,754 million US dollars in 2020, followed by a decrease to 7,715 million in 2021. Subsequent years show a shift to negative economic profits, with values declining sharply to -7,392 million in 2022, further deepening to -13,673 million in 2023, and reaching -23,846 million by 2024.

Invested capital displays a steady, albeit moderate, increase throughout the same period. Starting from 81,967 million US dollars in 2020, it grew consistently each year, ending at 92,296 million in 2024. This gradual rise indicates ongoing or sustained capital investment despite the decline in economic profitability.

The economic spread ratio, a key indicator of the company's profitability relative to capital invested, mirrors the trend observed in economic profit. From a healthy positive margin of 14.34% in 2020, it fell to 8.72% in 2021 before turning negative in 2022 at -8.34%. The negative trend accelerates thereafter, with ratios of -14.85% in 2023 and -25.84% in 2024, suggesting deteriorating returns on invested capital.

Summary of Trends

- Economic profit has shifted from significant positive values to increasingly large negative values over five years.

- Invested capital shows steady growth, indicating continuous investment despite declining profits.

- The economic spread ratio consistently worsens, moving from a positive to an increasingly negative position, signaling a decrease in efficiency in utilizing invested capital to generate profit.

- The data highlights a growing imbalance where investment increases while economic returns decline, raising concerns about the effectiveness of capital allocation strategies over time.

The financial data over the five-year period from 2020 to 2024 indicates significant shifts in both economic profit and net revenue, alongside notable changes in economic profit margin.

Economic Profit

The economic profit displays a declining trend over the observed period. Starting with a positive value of 11,754 million US dollars in 2020, it decreased to 7,715 million in 2021. From 2022 onwards, the economic profit turned negative and worsened consistently, reaching -7,392 million in 2022, -13,673 million in 2023, and further declining to -23,846 million in 2024. This transition from profitability to loss suggests increasing inefficiencies or rising costs relative to returns during the latter years.

Net Revenue

Net revenue hovered around 77,867 to 79,024 million US dollars between 2020 and 2021, showing a relatively stable or modest growth period. However, in 2022 there was a pronounced decline to 63,054 million, followed by an ongoing reduction to 54,228 million in 2023, and a slight further decrease to 53,101 million in 2024. This downward revenue trend indicates possible challenges in sales, reduced demand, or pricing pressures affecting overall income generation.

Economic Profit Margin

The economic profit margin, which reflects the economic profit as a percentage of net revenue, mirrors the overall economic profit trend. It fell from a positive 15.09% in 2020 to 9.76% in 2021, before swinging to negative margins from 2022 onwards. Negative margins deepened steadily, from -11.72% in 2022 to -25.21% in 2023, and finally to -44.91% in 2024. The increasingly negative margin emphasizes deteriorating profitability relative to net revenue, indicating the company's economic value generation per unit of revenue has significantly declined.

In summary, the data demonstrates a clear deterioration in financial health over the five-year period, marked by declining net revenue, a switch from positive to substantially negative economic profit, and worsening economic profit margins. These trends suggest operational or market challenges impacting profitability and economic value creation.