Intel Corp. (NASDAQ:INTC)

The two-component DuPont disaggregation reveals a severe deterioration in equity returns over the observed period. Return on Equity (ROE) experienced a consistent and steep decline, transitioning from a peak of 23.87% in April 2022 to negative values for the majority of the subsequent years, concluding at -12.90% by June 2026.

Return on Assets (ROA) Trends

A significant downward trajectory is evident in asset profitability. Starting at 13.96% in early 2022, ROA declined steadily throughout the year, entering negative territory by April 2023. Despite a brief period of recovery peaking at 2.11% in March 2024, the metric suffered a sharp collapse, reaching a low of -10.65% by June 2025. This pattern indicates a substantial erosion of operational efficiency and the ability to generate net income from the asset base.

Financial Leverage Dynamics

Financial leverage remained relatively stable for the majority of the analysis period, generally fluctuating between 1.68 and 1.98. However, a notable upward shift occurred toward the end of the sequence, with the ratio peaking at 2.31 in June 2026. This increase in leverage indicates a higher proportion of debt relative to equity, which intensified the volatility of the equity returns.

ROE Driver Synthesis

The collapse in ROE is almost exclusively driven by the precipitous drop in ROA. During the initial period of 2022, moderate financial leverage amplified positive asset returns, resulting in strong ROE. Conversely, in the latter half of the period—specifically from September 2024 through June 2025—the combination of deeply negative ROA and increasing financial leverage acted as a multiplier for losses, leading to a trough in ROE of -20.95%. The final observations indicate that while ROA showed slight volatility, the increased leverage continues to amplify the negative impact on shareholder returns.

The Return on Equity (ROE) exhibits a severe long-term contraction, transitioning from a peak of 23.87% in early 2022 to a final value of -12.90% by mid-2026. This deterioration is characterized by extreme volatility and prolonged periods of negative returns, indicating a significant decline in the company's ability to generate profits from shareholder equity.

Net Profit Margin

Profitability serves as the primary driver of the ROE decline. A sharp downward trend is observed starting from 31.68% in April 2022, falling into negative territory by April 2023. While brief periods of recovery occurred in late 2023 and early 2024, the margin collapsed to a low of -38.64% by June 2025. The period concludes with continued instability, ending at -19.79%.

Asset Turnover

Operational efficiency shows a steady and consistent decline. The ratio decreased from 0.44 in early 2022 to a range between 0.25 and 0.28 for the remainder of the analyzed period. This suggests a diminishing capacity to generate revenue relative to the asset base, compounding the negative impact of the shrinking profit margins.

Financial Leverage

Leverage remained relatively stable between 1.68 and 1.98 for most of the timeline, providing a modest multiplier effect on both positive and negative returns. However, a notable increase is observed in the final quarter, where the ratio spiked to 2.31, indicating an increase in debt reliance or a reduction in equity during a period of negative profitability.

The synthesis of the three DuPont components reveals that the collapse in ROE is predominantly a result of catastrophic margin erosion rather than financial structure or asset utilization. The modest increase in financial leverage toward the end of the period served to amplify the negative impact of the operating losses, accelerating the decline in shareholder returns.

The analysis of the two-component disaggregation of Return on Assets (ROA) reveals a significant deterioration in overall profitability and asset efficiency from April 2022 through June 2026. The ROA exhibits a consistent downward trajectory, transitioning from a peak of 13.96% in early 2022 to a negative 5.58% by mid-2026, characterized by periods of extreme volatility and substantial margin compression.

Net Profit Margin Trends

A severe decline in profitability is observed over the analyzed period. The margin began at 31.68% in April 2022 but experienced a steady contraction throughout 2022. The company entered a period of instability in 2023, fluctuating between marginal losses and slight gains. A critical downturn occurred between September 2024 and June 2025, where margins plummeted to a low of -38.64%. Despite a brief recovery toward the break-even point in September 2025, the margin resumed a negative trend, ending at -19.79% in June 2026.

Asset Turnover Performance

Asset utilization shows a gradual and sustained decline. The asset turnover ratio decreased from 0.44 in April 2022 to 0.35 by the end of that year. Throughout 2023 and 2024, the ratio remained relatively stagnant, fluctuating within a narrow band between 0.27 and 0.30. A further slight erosion is noted in 2025, reaching a low of 0.25 in September, before stabilizing at 0.28 in June 2026. This indicates a diminishing capacity to generate revenue from the asset base.

ROA Driver Analysis

The decomposition of ROA indicates that the collapse in return is primarily driven by the erosion of the Net Profit Margin rather than the decline in Asset Turnover. While asset efficiency decreased by approximately 36% from its peak, the profit margin shifted from highly positive to deeply negative. The correlation between the Net Profit Margin and ROA is nearly absolute, suggesting that the primary catalysts for the declining ROA are rising costs or falling prices rather than a failure in asset deployment or capacity utilization.