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.
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Intel Corp. pages available for free this week:
- Cash Flow Statement
- Analysis of Liquidity Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Assets (ROA) since 2005
- Total Asset Turnover since 2005
- Analysis of Revenues
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Economic Profit
Intel Corp., economic profit calculation
US$ in millions
| 12 months ended: | Dec 28, 2024 | Dec 30, 2023 | Dec 31, 2022 | Dec 25, 2021 | Dec 26, 2020 | |
|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | ||||||
| Cost of capital2 | ||||||
| Invested capital3 | ||||||
| Economic profit4 | ||||||
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
= – × =
- Net Operating Profit After Taxes (NOPAT)
- The net operating profit after taxes exhibited a notable decline over the periods analyzed. Starting at 22,960 million USD in 2020, it decreased to 19,493 million USD in 2021 and experienced a sharp drop to 3,672 million USD in 2022. The downward trend continued with negative figures reported in 2023 (-1,469 million USD) and further deteriorated in 2024 to -13,095 million USD.
- Cost of Capital
- The cost of capital showed a modest fluctuation during the periods. It started at 13.53% in 2020, then gradually decreased to 13.18% in 2021 and further to 12.36% in 2022. In 2023, there was a slight increase to 13.12%, followed by a decline to 11.54% in 2024, marking the lowest rate observed across the periods.
- Invested Capital
- Invested capital demonstrated a steady increase throughout the periods. It rose from 81,967 million USD in 2020 to 88,498 million USD in 2021, with marginal growth to 88,671 million USD in 2022. The trend continued upward to 92,095 million USD in 2023 and reached 92,296 million USD in 2024, indicating ongoing investment expansion despite profitability challenges.
- Economic Profit
- Economic profit experienced a pronounced decline over the years. Beginning with a positive economic profit of 11,867 million USD in 2020, it dropped significantly to 7,833 million USD in 2021. The figure turned negative in 2022 at -7,283 million USD and further worsened in 2023 (-13,554 million USD) and 2024 (-23,748 million USD), reflecting deteriorating value creation relative to the cost of capital.
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
= × =
5 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
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
= × 21.00% =
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 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
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 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
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 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
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 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
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 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
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 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| Economic spread ratio3 | ||||||
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Advanced Micro Devices Inc. | ||||||
| Analog Devices Inc. | ||||||
| Applied Materials Inc. | ||||||
| Broadcom Inc. | ||||||
| KLA Corp. | ||||||
| Lam Research Corp. | ||||||
| Micron Technology Inc. | ||||||
| NVIDIA Corp. | ||||||
| Qualcomm Inc. | ||||||
| Texas Instruments Inc. | ||||||
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 × ÷ =
4 Click competitor name to see calculations.
The financial data reveals a notable decline in economic profit over the five-year period. Initially, economic profit stood at a robust level, but it experienced a significant decrease year over year, transitioning from positive values in 2020 and 2021 to negative figures starting 2022 and worsening through 2023 and 2024. This downward trajectory indicates increasing challenges in generating returns above the cost of capital.
Invested capital shows a moderate upward trend, increasing steadily from 2020 through 2024. The gradual increase suggests ongoing investments or accumulation of assets base over the years, despite the declining profitability as reflected in economic profit.
The economic spread ratio mirrors the trend observed in economic profit. It starts from a strong positive position in 2020, decreases sharply in 2021, and turns negative from 2022 onwards with increasing magnitude of negativity through to 2024. This pattern signals deteriorating returns relative to the invested capital, suggesting the firm's operations or capital deployment became less efficient or profitable over this time span.
- Economic Profit
- Decreased from $11,867 million in 2020 to a negative $23,748 million in 2024, indicating a transition from solid profitability to sustained economic losses.
- Invested Capital
- Increased gradually from $81,967 million in 2020 to $92,296 million in 2024, reflecting consistent investment or asset growth despite declining profitability.
- Economic Spread Ratio
- Dropped from 14.48% in 2020 to -25.73% in 2024, highlighting a shift from generating returns above cost of capital to significant negative spreads, which detracts from shareholder value.
Overall, the data reflect deteriorating economic performance and efficiency in capital usage over the years assessed. The combination of rising invested capital with worsening economic profit and spread suggests that the company may face challenges in maximizing returns from its investments or may be affected by adverse external or internal factors impacting profitability.
Economic Profit Margin
Intel Corp., economic profit margin calculation, comparison to benchmarks
| Dec 28, 2024 | Dec 30, 2023 | Dec 31, 2022 | Dec 25, 2021 | Dec 26, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | ||||||
| Net revenue | ||||||
| Performance Ratio | ||||||
| Economic profit margin2 | ||||||
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Advanced Micro Devices Inc. | ||||||
| Analog Devices Inc. | ||||||
| Applied Materials Inc. | ||||||
| Broadcom Inc. | ||||||
| KLA Corp. | ||||||
| Lam Research Corp. | ||||||
| Micron Technology Inc. | ||||||
| NVIDIA Corp. | ||||||
| Qualcomm Inc. | ||||||
| Texas Instruments Inc. | ||||||
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 × ÷ =
3 Click competitor name to see calculations.
The analysis of Intel Corp.'s financial performance over the five-year period from 2020 to 2024 reveals several significant trends across economic profit, net revenue, and economic profit margin.
- Economic Profit
- Economic profit has demonstrated a strong declining trajectory. It began with a positive figure of 11,867 million US dollars in 2020, followed by a reduction to 7,833 million in 2021. Subsequently, economic profit moved into negative territory in 2022 with a loss of 7,283 million US dollars, which further deteriorated to negative 13,554 million in 2023, and reached -23,748 million in 2024. This trend reflects increasing challenges in generating value above the cost of capital, suggesting rising costs or declining returns.
- Net Revenue
- Net revenue exhibited a peak in 2021 at 79,024 million US dollars, a slight increase from 77,867 million in 2020. However, from 2021 onward, net revenue steadily declined, falling to 63,054 million in 2022, 54,228 million in 2023, and 53,101 million in 2024. This consistent downward trend indicates a decreasing top-line performance over the recent years.
- Economic Profit Margin
- Economic profit margin, indicating the efficiency of converting revenue into economic profit, closely mirrors the economic profit trend. It started at a healthy margin of 15.24% in 2020 and decreased to 9.91% in 2021. The margin then turned negative, indicating losses relative to revenue, with -11.55% in 2022, sharply deteriorating to -24.99% in 2023, and further to -44.72% in 2024. This suggests worsening profitability and increasing inefficiency in capital utilization.
Overall, the data indicates a declining financial health trend characterized by shrinking revenues, increasing economic losses, and deteriorating profitability margins. This scenario may warrant a strategic review to identify causes such as market conditions, cost structure issues, or operational inefficiencies.