Stock Analysis on Net
Stock Analysis on Net

Monolithic Power Systems Inc. (NASDAQ:MPWR)

This company has been moved to the archive! The financial data has not been updated since May 5, 2025.

Common-Size Income Statement

Monolithic Power Systems Inc., common-size consolidated income statement

Microsoft Excel
12 months ended: Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Revenue 100.00 100.00 100.00 100.00 100.00
Cost of revenue -44.68 -43.93 -41.56 -43.25 -44.82
Gross profit 55.32% 56.07% 58.44% 56.75% 55.18%
Research and development -14.71 -14.48 -13.39 -15.78 -16.29
Selling, general and administrative -16.16 -15.14 -15.70 -19.24 -20.07
Operating expenses -30.88% -29.62% -29.08% -35.03% -36.36%
Operating income 24.44% 26.45% 29.36% 21.73% 18.81%
Interest income 1.23 1.28 0.80 0.96 1.10
Amortization of discount (premium) on available-for-sale securities, net 0.91 0.29 -0.24 -0.39 -0.35
Gain (loss) on deferred compensation plan investments 0.43 0.47 -0.37 0.38 0.54
Charitable contributions -1.08 -0.82 -0.33 -0.12 -0.09
Gain on sale of equity investment 0.00 0.08 0.00 0.00 0.00
Other 0.03 0.02 0.04 -0.02 0.03
Other income (expense), net 1.52% 1.32% -0.10% 0.81% 1.24%
Income before income taxes 25.96% 27.78% 29.26% 22.54% 20.05%
Income tax (expense) benefit, net 54.99 -4.31 -4.86 -2.50 -0.59
Net income 80.95% 23.47% 24.39% 20.04% 19.47%

Based on: 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), 10-K (reporting date: 2020-12-31).

An analysis of the common-size income statement reveals a period of operational scaling and strong margin stability, punctuated by a significant non-operational impact on the bottom line in the final period.

Gross Profitability and Cost Structure
Gross profit margins remained consistently high, fluctuating between 55.18% in 2020 and a peak of 58.44% in 2022. The cost of revenue showed relative stability, though a slight upward trend is noted in the final two years, reaching 44.68% by 2024. This suggests a well-managed direct cost structure with strong pricing power, despite minor fluctuations in production or material costs.
Operating Expense Efficiency
A general trend of operational efficiency is evident in the management of operating expenses, which declined from 36.36% of revenue in 2020 to 30.88% in 2024. This improvement was primarily driven by a sustained reduction in selling, general, and administrative (SG&A) expenses, which dropped from 20.07% to 16.16% over the five-year period. Meanwhile, research and development (R&D) spending remained a consistent priority, averaging approximately 15% of revenue, indicating a steady commitment to innovation relative to growth.
Operating Income Trends
Operating income as a percentage of revenue experienced significant expansion in the early part of the period, rising from 18.81% in 2020 to a peak of 29.36% in 2022. However, a gradual contraction followed, with the margin retreating to 24.44% by 2024. This trajectory suggests that the operational gains achieved through SG&A efficiencies were partially offset by a slight increase in the cost of revenue and R&D expenditures in later years.
Net Income and Tax Anomalies
While income before taxes mirrored the operating income trend, peaking at 29.26% in 2022, the net income figures show a stark divergence in 2024. For most of the period, net income tracked closely with operating performance, ranging from 19.47% to 24.39%. In 2024, however, net income spiked to 80.95%. This anomaly is directly attributable to a significant income tax benefit of 54.99%, rather than an increase in core operational profitability.

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