Intel Corp. (NASDAQ:INTC)

The financial performance, as indicated by Return on Equity (ROE) and its components, exhibits significant fluctuations over the observed period. A clear downward trend in ROE is apparent, particularly from the latter half of 2023 through the first half of 2025. This trend is driven by a consistent decline in Return on Assets (ROA), which transitions from positive values to negative territory during the analyzed timeframe. Financial Leverage, however, demonstrates relative stability, with a slight overall increase before stabilizing and then decreasing slightly towards the end of the period.

Return on Assets (ROA)

ROA begins at 13.96% in April 2022 and steadily decreases, reaching negative values in April 2023 (-1.54%) and continuing to decline to -10.65% by December 2024. A minor recovery to 0.10% is observed in September 2025, but it quickly reverts to -0.13% by December 2025. This consistent decline suggests diminishing profitability relative to the company’s total assets.

Financial Leverage

Financial Leverage shows a gradual increase from 1.71 in April 2022 to 1.89 in April 2023. It then plateaus, fluctuating between 1.81 and 1.98 for several quarters. A slight decrease is noted towards the end of the period, with the ratio falling to 1.85 in December 2025. This indicates a relatively consistent use of debt financing, with a minor reduction in leverage towards the end of the observation period.

Return on Equity (ROE)

ROE mirrors the trend in ROA, starting at 23.87% in April 2022 and declining to -20.95% by December 2024. Similar to ROA, a brief positive value of 0.19% appears in September 2025, followed by a return to negative territory (-0.23%) in December 2025. The decline in ROE is initially amplified by increasing financial leverage, but as leverage stabilizes, the ROE decline is primarily driven by the deteriorating ROA. The negative ROE values observed in the later periods indicate that the company is generating losses for its shareholders.

The interplay between ROA and Financial Leverage demonstrates that while the company initially utilized debt to amplify returns, the declining asset profitability has overwhelmed this effect, resulting in a substantial decrease in overall shareholder returns. The recent negative ROA and ROE values are particularly concerning and warrant further investigation into the underlying causes of asset underperformance.

The disaggregated components of Return on Equity (ROE) reveal a period of significant volatility and, ultimately, declining performance. Initial values demonstrate a relatively healthy ROE, driven by a combination of profitability, asset utilization, and financial leverage. However, subsequent periods show a marked deterioration in net profit margin, which exerts a substantial downward pressure on ROE.

Net Profit Margin

The Net Profit Margin exhibits a consistent decline from 31.68% in April 2022 to negative values beginning in April 2023. While a brief recovery to 3.11% is observed in December 2022, this is followed by a steep drop, culminating in a substantial negative margin of -38.64% in March 2025. The most recent period shows a slight improvement to -0.51% in December 2025, but remains significantly below initial levels. This suggests increasing cost pressures or declining revenue generation.

Asset Turnover

Asset Turnover demonstrates a gradual, though relatively stable, downward trend. Starting at 0.44 in April 2022, it decreases to 0.25 by December 2025. This indicates a decreasing efficiency in utilizing assets to generate sales. The rate of decline appears to be accelerating in the later periods, potentially exacerbating the impact of declining profitability.

Financial Leverage

Financial Leverage remains relatively stable throughout the observed period, fluctuating between 1.68 and 1.98. A slight upward trend is visible in the first half of the period, followed by a modest decline towards the end. While leverage does not appear to be the primary driver of the ROE decline, its consistent presence amplifies the effects of the decreasing profitability and asset turnover. The increase in leverage in the earlier periods may have initially boosted ROE, but this effect has been overwhelmed by subsequent performance issues.

Return on Equity (ROE)

ROE mirrors the trends observed in its component ratios. Beginning at 23.87% in April 2022, it declines steadily, becoming negative in April 2023 and reaching its lowest point at -20.95% in December 2022. While there is a slight recovery to -0.23% in December 2025, ROE remains substantially below its initial value. The negative ROE in recent periods indicates that the company is generating insufficient returns to satisfy equity holders.

The combined effect of declining profitability and asset utilization has resulted in a significant deterioration in ROE. While financial leverage has remained relatively constant, it has not been sufficient to offset the negative impacts of the other two components. The recent slight improvement in net profit margin in the final period offers a small degree of optimism, but sustained recovery will require addressing the underlying issues impacting both profitability and asset efficiency.

The financial performance, as indicated by the two-component disaggregation of Return on Assets (ROA), reveals a period of significant fluctuation and overall decline. Initially, the observed values demonstrate a relatively stable ROA driven by both Net Profit Margin and Asset Turnover. However, subsequent periods exhibit increasing volatility and a general weakening of profitability.

Net Profit Margin

The Net Profit Margin experienced a consistent downward trend from 31.68% in April 2022 to -38.64% in March 2025. The decline was particularly pronounced in the latter half of the observed period, indicating increasing pressure on profitability. A brief recovery to 3.11% in December 2022 was followed by a continued descent, culminating in substantial negative margins. The most recent periods show continued negative margins, albeit with some moderation, reaching -0.51% in December 2025 and a slight positive value of 0.37% in September 2025.

Asset Turnover

Asset Turnover exhibited a more gradual decline, decreasing from 0.44 in April 2022 to 0.25 in December 2025. While the decrease was consistent, it was less dramatic than the changes observed in the Net Profit Margin. The rate of decline appeared to accelerate slightly in the later periods, suggesting a diminishing efficiency in utilizing assets to generate revenue. Values remained relatively stable between 0.26 and 0.28 for several quarters before the final decline.

Return on Assets (ROA)

The ROA mirrored the combined effect of the trends in its component ratios. Starting at 13.96% in April 2022, it steadily decreased, becoming negative in April 2023 and remaining so for most of the subsequent periods. The lowest ROA values were recorded in March 2025 (-36.19%) and December 2024 (-35.32%). A slight positive ROA of 0.10% was observed in September 2025, but this was followed by a negative value in December 2025. The overall trend indicates a significant deterioration in the company’s ability to generate profits from its assets.

The interplay between declining profitability and decreasing asset utilization has resulted in a substantial reduction in ROA. The negative Net Profit Margins in recent periods are the primary driver of the negative ROA, although the declining Asset Turnover also contributes to the overall weakening performance. The brief periods of improvement were insufficient to offset the overarching negative trends.