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.
Economic Profit
Mondelēz International Inc., economic profit calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 2,920 – 8.52% × 61,526 = -2,324
The analysis of economic value added from 2021 to 2025 reveals a pattern of inconsistent value creation, with the organization struggling to consistently generate returns that exceed its cost of capital. Economic profit remained negative for the majority of the period, indicating that the operational returns were insufficient to cover the implicit cost of the invested capital.
- Net Operating Profit After Taxes (NOPAT) Trends
- NOPAT exhibited significant volatility over the five-year span. An initial decline occurred in 2022, with profits dropping to US$ 3,016 million. A substantial recovery followed in 2023, reaching a peak of US$ 5,433 million, before experiencing a sharp contraction to US$ 2,920 million by 2025. This instability in operational earnings is the primary driver of the fluctuations in economic profit.
- Invested Capital and Cost of Capital Stability
- Invested capital remained relatively stagnant, fluctuating within a narrow range between US$ 60,269 million and US$ 63,833 million. Similarly, the cost of capital showed minimal variance, peaking at 8.96% in 2023 and ending the period at 8.52% in 2025. The stability of these two metrics suggests that the swings in economic profit were not caused by changes in the capital base or funding costs, but rather by operational performance.
- Economic Profit and Value Destruction
- The economic profit figures indicate a trend of value destruction in most years. A significant deficit was recorded in 2022 at -US$ 2,507 million, which improved to a marginal positive value of US$ 22 million in 2024. However, this brief period of value creation was short-lived, as economic profit fell again to -US$ 2,324 million in 2025. The inability to maintain a positive economic profit suggests that the return on invested capital frequently fell below the required 8.5% to 9.0% threshold.
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Net Operating Profit after Taxes (NOPAT)
Mondelēz International Inc., NOPAT calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowances for credit losses.
3 Addition of increase (decrease) in restructuring Program liability.
4 Addition of increase (decrease) in equity equivalents to net earnings attributable to Mondelēz International.
5 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 763 × 5.40% = 41
6 2025 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 640 × 21.00% = 134
7 Addition of after taxes interest expense to net earnings attributable to Mondelēz International.
Net operating profit after taxes (NOPAT) exhibited fluctuations over the five-year period. While net earnings attributable to Mondelēz International demonstrated volatility, NOPAT generally tracked a similar pattern, though with differing magnitudes. An initial decline was followed by a period of growth, then a subsequent decrease.
- Overall Trend
- NOPAT began at US$4,733 million in 2021, decreased to US$3,016 million in 2022, then increased significantly to US$5,433 million in 2023. This upward momentum continued, albeit at a slower pace, reaching US$5,271 million in 2024 before declining to US$2,920 million in 2025.
- Year-over-Year Changes
- The largest year-over-year decrease occurred between 2021 and 2022, with NOPAT falling by US$1,717 million. Conversely, the most substantial increase was observed between 2022 and 2023, with NOPAT rising by US$2,417 million. A moderate decrease of US$162 million was noted between 2023 and 2024, followed by a more pronounced decline of US$2,351 million between 2024 and 2025.
- Relationship to Net Earnings
- In 2021, NOPAT exceeded net earnings by US$433 million. This difference narrowed in 2022, with NOPAT exceeding net earnings by only US$299 million. In 2023, NOPAT surpassed net earnings by US$474 million. The gap widened again in 2024 to US$660 million, but then contracted significantly in 2025, with NOPAT exceeding net earnings by only US$469 million. This suggests a changing relationship between operating profitability and overall net income.
The considerable decrease in NOPAT in 2025 warrants further investigation to determine the underlying factors contributing to this decline. The fluctuations observed throughout the period suggest sensitivity to external economic conditions or internal operational changes.
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Cash Operating Taxes
Mondelēz International Inc., cash operating taxes calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The provision for income taxes and cash operating taxes exhibited fluctuating behavior between 2021 and 2025. While both metrics moved in similar directions, notable differences in magnitude and specific year-over-year changes were observed.
- Provision for Income Taxes
- The provision for income taxes decreased from US$1,190 million in 2021 to US$865 million in 2022, representing a substantial decline. This was followed by a significant increase to US$1,537 million in 2023. A further, though smaller, increase occurred in 2024, reaching US$1,469 million, before decreasing considerably to US$782 million in 2025. The volatility suggests potential impacts from changes in tax regulations, geographic earnings mix, or the recognition of tax benefits.
- Cash Operating Taxes
- Cash operating taxes demonstrated a decrease from US$1,066 million in 2021 to US$1,003 million in 2022. A marked increase was then recorded in 2023, with cash operating taxes reaching US$1,697 million. This was followed by a decrease to US$1,328 million in 2024, and a further decline to US$900 million in 2025. The pattern mirrors that of the provision for income taxes, but the absolute values are consistently lower.
- Relationship between Provision and Cash Taxes
- In 2021 and 2022, the difference between the provision for income taxes and cash operating taxes was relatively small, approximately US$124 million and US$162 million respectively. However, this difference widened significantly in 2023 to US$160 million, decreased in 2024 to US$141 million, and then increased again in 2025 to US$182 million. This divergence suggests changes in the timing of tax payments relative to reported income, potentially due to deferred tax assets or liabilities, or differences in tax accounting versus cash accounting methods.
- Overall Trend
- Both measures experienced a peak in 2023, followed by a decline in 2024 and 2025. The 2025 values for both the provision for income taxes and cash operating taxes represent the lowest levels observed during the analyzed period. This suggests a potential reduction in taxable income or increased utilization of tax credits in the latter years.
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Invested Capital
Mondelēz International Inc., invested capital calculation (financing approach)
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of restructuring Program liability.
5 Addition of equity equivalents to total Mondelēz International shareholders’ equity.
6 Removal of accumulated other comprehensive income.
7 Subtraction of construction in progress.
The invested capital of the company exhibited relative stability over the five-year period, with fluctuations occurring between approximately US$60.3 billion and US$63.8 billion. A slight increase is observed from 2021 to 2022, followed by a decrease in 2023, and a further decrease in 2024. The final year, 2025, shows a modest increase, returning invested capital to levels similar to those seen in 2021.
- Total Reported Debt & Leases
- Total reported debt and leases increased significantly from 2021 to 2022, rising from US$20.1 billion to US$23.6 billion. This was followed by a substantial decrease in 2023 to US$20.1 billion, and a further reduction in 2024 to US$18.5 billion. A subsequent increase is noted in 2025, reaching US$21.968 billion. This indicates active debt management and potential shifts in financing strategies.
- Total Shareholders’ Equity
- Total shareholders’ equity experienced a decrease from 2021 to 2022, moving from US$28.3 billion to US$26.9 billion. It then increased in 2023 to US$28.3 billion, before decreasing again in 2024 to US$26.9 billion, and finally declining further in 2025 to US$25.8 billion. This suggests potential impacts from net income, dividends, and share repurchases on equity value.
- Relationship between Debt, Equity, and Invested Capital
- Invested capital is calculated as the sum of total debt and shareholders’ equity. The fluctuations in both debt and equity contribute to the observed stability in invested capital. While debt levels decreased in 2023 and 2024, equity also decreased, partially offsetting the impact on the overall invested capital figure. The increase in debt in 2025, coupled with a further decrease in equity, resulted in a modest increase in invested capital.
The observed patterns suggest a dynamic capital structure, with the company actively managing its debt and equity positions. Further investigation into the underlying drivers of these changes, such as profitability, investment activities, and financing decisions, would be necessary for a more comprehensive understanding.
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Cost of Capital
Mondelēz International Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 76,142) | 76,142) | ÷ | 96,458) | = | 0.79 | 0.79 | × | 10.21% | = | 8.06% | ||
| Debt3 | 19,553) | 19,553) | ÷ | 96,458) | = | 0.20 | 0.20 | × | 2.68% × (1 – 21.00%) | = | 0.43% | ||
| Operating lease liability4 | 763) | 763) | ÷ | 96,458) | = | 0.01 | 0.01 | × | 5.40% × (1 – 21.00%) | = | 0.03% | ||
| Total: | 96,458) | 1.00 | 8.52% | ||||||||||
Based on: 10-K (reporting date: 2025-12-31).
1 US$ 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 | 74,287) | 74,287) | ÷ | 90,928) | = | 0.82 | 0.82 | × | 10.21% | = | 8.34% | ||
| Debt3 | 15,846) | 15,846) | ÷ | 90,928) | = | 0.17 | 0.17 | × | 2.38% × (1 – 21.00%) | = | 0.33% | ||
| Operating lease liability4 | 795) | 795) | ÷ | 90,928) | = | 0.01 | 0.01 | × | 5.50% × (1 – 21.00%) | = | 0.04% | ||
| Total: | 90,928) | 1.00 | 8.71% | ||||||||||
Based on: 10-K (reporting date: 2024-12-31).
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 | 103,504) | 103,504) | ÷ | 121,712) | = | 0.85 | 0.85 | × | 10.21% | = | 8.68% | ||
| Debt3 | 17,506) | 17,506) | ÷ | 121,712) | = | 0.14 | 0.14 | × | 2.19% × (1 – 21.00%) | = | 0.25% | ||
| Operating lease liability4 | 702) | 702) | ÷ | 121,712) | = | 0.01 | 0.01 | × | 5.10% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 121,712) | 1.00 | 8.96% | ||||||||||
Based on: 10-K (reporting date: 2023-12-31).
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 | 89,856) | 89,856) | ÷ | 110,753) | = | 0.81 | 0.81 | × | 10.21% | = | 8.28% | ||
| Debt3 | 20,217) | 20,217) | ÷ | 110,753) | = | 0.18 | 0.18 | × | 2.40% × (1 – 21.00%) | = | 0.35% | ||
| Operating lease liability4 | 680) | 680) | ÷ | 110,753) | = | 0.01 | 0.01 | × | 4.20% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 110,753) | 1.00 | 8.65% | ||||||||||
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 | 93,046) | 93,046) | ÷ | 113,928) | = | 0.82 | 0.82 | × | 10.21% | = | 8.34% | ||
| Debt3 | 20,249) | 20,249) | ÷ | 113,928) | = | 0.18 | 0.18 | × | 1.82% × (1 – 21.00%) | = | 0.26% | ||
| Operating lease liability4 | 633) | 633) | ÷ | 113,928) | = | 0.01 | 0.01 | × | 3.30% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 113,928) | 1.00 | 8.61% | ||||||||||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Mondelēz International Inc., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | (2,324) | 22) | (75) | (2,507) | (567) | |
| Invested capital2 | 61,526) | 60,269) | 61,495) | 63,833) | 61,560) | |
| Performance Ratio | ||||||
| Economic spread ratio3 | -3.78% | 0.04% | -0.12% | -3.93% | -0.92% | |
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Coca-Cola Co. | 5.93% | 3.47% | 3.97% | 3.66% | 5.20% | |
| PepsiCo Inc. | 2.72% | 5.30% | 4.22% | 4.19% | 4.75% | |
| Philip Morris International Inc. | 13.11% | 8.14% | 8.81% | 11.75% | 26.08% | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × -2,324 ÷ 61,526 = -3.78%
4 Click competitor name to see calculations.
The financial performance regarding economic value creation exhibits significant volatility between 2021 and 2025. The ability to generate returns exceeding the cost of capital has been inconsistent, characterized by periods of value destruction followed by a brief window of value creation.
- Economic Profit Trends
- Economic profit remained negative for the majority of the analyzed period. A substantial decline occurred in 2022, reaching a deficit of 2,507 million USD. This was followed by a recovery phase in 2023 and a transition to a positive economic profit of 22 million USD in 2024, indicating that the company successfully generated returns above its cost of capital during that fiscal year. However, a sharp reversal occurred in 2025, with economic profit falling to negative 2,324 million USD.
- Invested Capital Stability
- Invested capital demonstrated relative stability throughout the five-year period, fluctuating within a narrow range between 60,269 million USD and 63,833 million USD. The peak in invested capital occurred in 2022, coinciding with the lowest point of economic profit, while the lowest capital investment was recorded in 2024, the only year of positive economic profit.
- Economic Spread Ratio Performance
- The economic spread ratio mirrors the volatility of the economic profit. The ratio reached its lowest point of -3.93% in 2022, signifying a wide gap between the actual return on capital and the required cost of capital. Improvement was observed through 2023, leading to a marginal positive spread of 0.04% in 2024. This positive trend was short-lived, as the ratio declined again to -3.78% by December 31, 2025, indicating a return to a state where the cost of capital exceeds the generated returns.
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Economic Profit Margin
Mondelēz International Inc., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | (2,324) | 22) | (75) | (2,507) | (567) | |
| Net revenues | 38,537) | 36,441) | 36,016) | 31,496) | 28,720) | |
| Performance Ratio | ||||||
| Economic profit margin2 | -6.03% | 0.06% | -0.21% | -7.96% | -1.98% | |
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Coca-Cola Co. | 11.49% | 6.41% | 7.25% | 6.81% | 10.80% | |
| PepsiCo Inc. | 2.41% | 4.43% | 3.46% | 3.37% | 4.17% | |
| Philip Morris International Inc. | 17.19% | 10.38% | 12.87% | 17.52% | 24.21% | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Economic profit. See details »
2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Net revenues
= 100 × -2,324 ÷ 38,537 = -6.03%
3 Click competitor name to see calculations.
The financial performance from 2021 to 2025 is characterized by a consistent expansion in top-line growth contrasted by significant volatility in economic value creation. While net revenues demonstrated a steady upward trajectory throughout the period, economic profit failed to maintain a positive trend, indicating that the company struggled to consistently generate returns above its cost of capital.
- Net Revenue Growth
- A continuous increase in net revenues is observed, rising from US$ 28,720 million in 2021 to US$ 38,537 million by 2025. This represents a sustained growth pattern, with the most significant year-over-year increase occurring between 2022 and 2023.
- Economic Profit Volatility
- Economic profit exhibited substantial fluctuations. After a decline to negative US$ 2,507 million in 2022, the figure recovered sharply to negative US$ 75 million in 2023 and reached a marginal positive peak of US$ 22 million in 2024. However, this recovery was short-lived, as the value dropped precipitously to negative US$ 2,324 million in 2025.
- Economic Profit Margin Trends
- The economic profit margin mirrored the volatility of the absolute economic profit. The margin reached its lowest point in 2022 at -7.96%, followed by a recovery phase that peaked at a slight positive of 0.06% in 2024. The period concluded with a significant contraction to -6.03% in 2025, suggesting that the growth in net revenues was insufficient to offset the factors driving the decline in economic profit during the final year.
The divergence between increasing revenues and erratic economic profit margins suggests that scale expansion has not translated into sustainable economic value added. The sharp reversal in 2025 indicates a significant increase in the cost of capital or a substantial decline in operating efficiency relative to the capital employed.
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