Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.

Return on Invested Capital (ROIC)
Decomposition of ROIC
Operating Profit Margin (OPM)
Turnover of Capital (TO)
Effective Cash Tax Rate (CTR)

Micron Technology Inc., ROIC calculation, comparison to benchmarks

	Sep 3, 2020	Aug 29, 2019	Aug 30, 2018	Aug 31, 2017	Sep 1, 2016	Sep 3, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)¹	2,891	6,650	14,057	5,418	(7)	3,200
Invested capital²	42,291	38,774	35,408	28,526	22,012	16,740
Performance Ratio
ROIC³	6.84%	17.15%	39.70%	18.99%	-0.03%	19.12%
Benchmarks
ROIC, Competitors⁴
Advanced Micro Devices Inc.	—	11.73%	13.53%	2.05%	-14.86%	-27.01%
Analog Devices Inc.	6.95%	8.23%	4.98%	0.38%	23.10%	15.63%
Apple Inc.	150.10%	98.34%	83.60%	101.81%	114.33%	142.21%
Applied Materials Inc.	—	28.91%	29.78%	31.69%	20.54%	11.10%
Broadcom Inc.	—	5.00%	10.03%	3.52%	-1.55%	15.58%
Cisco Systems Inc.	24.12%	18.12%	2.85%	19.68%	23.64%	22.15%
Intel Corp.	—	26.74%	23.84%	10.03%	16.51%	17.27%
Lam Research Corp.	24.20%	20.10%	25.72%	31.56%	10.67%	15.45%
NVIDIA Corp.	19.63%	79.86%	41.40%	40.74%	31.19%	28.18%
Qualcomm Inc.	27.48%	28.27%	-16.74%	1.92%	27.12%	19.77%
Texas Instruments Inc.	—	43.15%	44.66%	32.30%	28.86%	24.07%

Based on: 10-K (filing date: 2020-10-19), 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27).

¹ NOPAT. See details »

² Invested capital. See details »

³ 2020 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 2,891 ÷ 42,291 = 6.84%

⁴ Click competitor name to see calculations.

Performance ratio	Description	The company
ROIC	A measure of the periodic, after tax, cash-on-cash yield earned in the business.	Micron Technology Inc.’s ROIC deteriorated from 2018 to 2019 and from 2019 to 2020.

Micron Technology Inc., decomposition of ROIC


	ROIC	=	OPM¹	×	TO²	×	1 – CTR³
Sep 3, 2020	6.84%	=	14.37%	×	0.51	×	93.87%
Aug 29, 2019	17.15%	=	29.89%	×	0.60	×	95.06%
Aug 30, 2018	39.70%	=	47.86%	×	0.86	×	96.64%
Aug 31, 2017	18.99%	=	28.39%	×	0.71	×	93.92%
Sep 1, 2016	-0.03%	=	1.37%	×	0.56	×	-4.15%
Sep 3, 2015	19.12%	=	21.08%	×	0.97	×	93.76%

Based on: 10-K (filing date: 2020-10-19), 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27).

¹ Operating profit margin (OPM). See calculations »

² Turnover of capital (TO). See calculations »

³ Effective cash tax rate (CTR). See calculations »

The primary reason for the decrease in return on invested capital (ROIC) over 2020 year is the decrease in profitability measured by operating profit margin (OPM) ratio.

Micron Technology Inc., OPM calculation, comparison to benchmarks

	Sep 3, 2020	Aug 29, 2019	Aug 30, 2018	Aug 31, 2017	Sep 1, 2016	Sep 3, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)¹	2,891	6,650	14,057	5,418	(7)	3,200
Add: Cash operating taxes²	189	345	489	351	177	213
Net operating profit before taxes (NOPBT)	3,080	6,995	14,546	5,769	170	3,413

Revenue	21,435	23,406	30,391	20,322	12,399	16,192
Profitability Ratio
OPM³	14.37%	29.89%	47.86%	28.39%	1.37%	21.08%
Benchmarks
OPM, Competitors⁴
Advanced Micro Devices Inc.	—	6.80%	5.88%	2.42%	-5.94%	-12.88%
Analog Devices Inc.	26.98%	29.60%	30.11%	21.16%	30.31%	23.13%
Apple Inc.	24.65%	24.64%	26.58%	26.64%	26.39%	30.76%
Applied Materials Inc.	—	23.89%	26.89%	29.01%	22.15%	17.40%
Broadcom Inc.	—	15.65%	24.22%	12.14%	-2.93%	24.07%
Cisco Systems Inc.	30.47%	25.46%	26.21%	27.94%	27.26%	23.84%
Intel Corp.	—	33.40%	30.95%	26.66%	21.44%	25.84%
Lam Research Corp.	27.26%	20.46%	29.43%	27.76%	18.88%	18.03%
NVIDIA Corp.	26.65%	33.09%	32.77%	24.50%	14.96%	15.98%
Qualcomm Inc.	24.17%	29.86%	1.24%	9.45%	26.09%	20.10%
Texas Instruments Inc.	—	40.81%	43.25%	41.06%	37.64%	32.94%

Based on: 10-K (filing date: 2020-10-19), 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27).

¹ NOPAT. See details »

² Cash operating taxes. See details »

³ 2020 Calculation
OPM = 100 × NOPBT ÷ Revenue
= 100 × 3,080 ÷ 21,435 = 14.37%

⁴ Click competitor name to see calculations.

Profitability ratio	Description	The company
OPM	The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales.	Micron Technology Inc.’s OPM deteriorated from 2018 to 2019 and from 2019 to 2020.

Micron Technology Inc., TO calculation, comparison to benchmarks

	Sep 3, 2020	Aug 29, 2019	Aug 30, 2018	Aug 31, 2017	Sep 1, 2016	Sep 3, 2015
Selected Financial Data (US$ in millions)
Revenue	21,435	23,406	30,391	20,322	12,399	16,192
Invested capital¹	42,291	38,774	35,408	28,526	22,012	16,740
Efficiency Ratio
TO²	0.51	0.60	0.86	0.71	0.56	0.97
Benchmarks
TO, Competitors³
Advanced Micro Devices Inc.	—	1.97	2.43	2.39	1.90	1.82
Analog Devices Inc.	0.31	0.33	0.33	0.26	0.85	0.86
Apple Inc.	7.10	4.79	8.83	4.47	5.26	6.05
Applied Materials Inc.	—	1.44	1.52	1.20	1.09	0.83
Broadcom Inc.	—	0.38	0.47	0.35	0.29	0.81
Cisco Systems Inc.	0.96	0.95	1.00	0.87	1.04	1.13
Intel Corp.	—	0.89	0.94	0.94	0.92	0.91
Lam Research Corp.	1.02	1.15	1.15	1.15	0.64	0.95
NVIDIA Corp.	0.77	2.45	1.50	1.71	2.08	1.89
Qualcomm Inc.	1.33	1.13	1.21	0.45	1.30	1.21
Texas Instruments Inc.	—	1.19	1.26	1.26	1.11	1.06

Based on: 10-K (filing date: 2020-10-19), 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27).

¹ Invested capital. See details »

² 2020 Calculation
TO = Revenue ÷ Invested capital
= 21,435 ÷ 42,291 = 0.51

³ Click competitor name to see calculations.

Efficiency ratio	Description	The company
TO	The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets.	Micron Technology Inc.’s TO deteriorated from 2018 to 2019 and from 2019 to 2020.

Micron Technology Inc., CTR calculation, comparison to benchmarks

	Sep 3, 2020	Aug 29, 2019	Aug 30, 2018	Aug 31, 2017	Sep 1, 2016	Sep 3, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)¹	2,891	6,650	14,057	5,418	(7)	3,200
Add: Cash operating taxes²	189	345	489	351	177	213
Net operating profit before taxes (NOPBT)	3,080	6,995	14,546	5,769	170	3,413
Tax Rate
CTR³	6.13%	4.94%	3.36%	6.08%	104.15%	6.24%
Benchmarks
CTR, Competitors⁴
Advanced Micro Devices Inc.	—	12.55%	5.44%	64.46%	—	—
Analog Devices Inc.	16.31%	14.82%	50.33%	93.08%	10.78%	21.70%
Apple Inc.	14.27%	16.60%	64.38%	14.50%	17.63%	23.61%
Applied Materials Inc.	—	16.09%	27.18%	8.67%	14.87%	23.00%
Broadcom Inc.	—	15.10%	11.38%	16.03%	—	19.97%
Cisco Systems Inc.	17.40%	24.92%	89.18%	19.15%	16.48%	17.77%
Intel Corp.	—	10.33%	18.16%	59.84%	16.68%	26.25%
Lam Research Corp.	13.09%	14.26%	24.00%	1.52%	11.77%	10.13%
NVIDIA Corp.	4.59%	1.47%	15.99%	2.78%	-0.02%	6.81%
Qualcomm Inc.	14.19%	16.37%	1,215.96%	54.68%	20.15%	19.01%
Texas Instruments Inc.	—	11.38%	18.14%	37.69%	31.13%	30.79%

Based on: 10-K (filing date: 2020-10-19), 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27).

¹ NOPAT. See details »

² Cash operating taxes. See details »

³ 2020 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 189 ÷ 3,080 = 6.13%

⁴ Click competitor name to see calculations.

Tax rate	Description	The company
CTR	Effective cash tax rate on operating income.	Micron Technology Inc.’s CTR increased from 2018 to 2019 and from 2019 to 2020.

Micron Technology Inc. (NASDAQ:MU)

Return on Capital (ROC)

Return on Invested Capital (ROIC)

Decomposition of ROIC

Operating Profit Margin (OPM)

Turnover of Capital (TO)

Effective Cash Tax Rate (CTR)