Analysis of Goodwill and Intangible Assets
Goodwill and Intangible Asset Disclosure
NVIDIA Corp., balance sheet: goodwill and intangible assets
US$ in millions
Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26), 10-K (reporting date: 2019-01-27), 10-K (reporting date: 2018-01-28), 10-K (reporting date: 2017-01-29), 10-K (reporting date: 2016-01-31).
| Item | Description | The company |
|---|---|---|
| Goodwill | Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. | |
| Goodwill and amortizable intangible assets | Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. | NVIDIA Corp. goodwill and amortizable intangible assets increased from 2019 to 2020 and from 2020 to 2021. |
Adjustments to Financial Statements: Removal of Goodwill
NVIDIA Corp., adjustments to financial statements
US$ in millions
Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26), 10-K (reporting date: 2019-01-27), 10-K (reporting date: 2018-01-28), 10-K (reporting date: 2017-01-29), 10-K (reporting date: 2016-01-31).
NVIDIA Corp., Financial Data: Reported vs. Adjusted
Adjusted Financial Ratios: Removal of Goodwill (Summary)
NVIDIA Corp., adjusted financial ratios
Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26), 10-K (reporting date: 2019-01-27), 10-K (reporting date: 2018-01-28), 10-K (reporting date: 2017-01-29), 10-K (reporting date: 2016-01-31).
| Financial ratio | Description | The company |
|---|---|---|
| Adjusted total asset turnover | An activity ratio calculated as total revenue divided by adjusted total assets. | NVIDIA Corp. adjusted total asset turnover ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
| Adjusted financial leverage | A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income. |
NVIDIA Corp. adjusted financial leverage ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level. |
| Adjusted ROE | A profitability ratio calculated as net income divided by adjusted shareholders’ equity. | NVIDIA Corp. adjusted ROE deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
| Adjusted ROA | A profitability ratio calculated as net income divided by adjusted total assets. | NVIDIA Corp. adjusted ROA deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
NVIDIA Corp., Financial Ratios: Reported vs. Adjusted
Adjusted Total Asset Turnover
Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26), 10-K (reporting date: 2019-01-27), 10-K (reporting date: 2018-01-28), 10-K (reporting date: 2017-01-29), 10-K (reporting date: 2016-01-31).
2021 Calculations
1 Total asset turnover = Revenue ÷ Total assets
= 16,675 ÷ 28,791 = 0.58
2 Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= 16,675 ÷ 24,598 = 0.68
| Activity ratio | Description | The company |
|---|---|---|
| Adjusted total asset turnover | An activity ratio calculated as total revenue divided by adjusted total assets. | NVIDIA Corp. adjusted total asset turnover ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
Adjusted Financial Leverage
Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26), 10-K (reporting date: 2019-01-27), 10-K (reporting date: 2018-01-28), 10-K (reporting date: 2017-01-29), 10-K (reporting date: 2016-01-31).
2021 Calculations
1 Financial leverage = Total assets ÷ Shareholders’ equity
= 28,791 ÷ 16,893 = 1.70
2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted shareholders’ equity
= 24,598 ÷ 12,700 = 1.94
| Solvency ratio | Description | The company |
|---|---|---|
| Adjusted financial leverage | A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income. |
NVIDIA Corp. adjusted financial leverage ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level. |
Adjusted Return on Equity (ROE)
Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26), 10-K (reporting date: 2019-01-27), 10-K (reporting date: 2018-01-28), 10-K (reporting date: 2017-01-29), 10-K (reporting date: 2016-01-31).
2021 Calculations
1 ROE = 100 × Net income ÷ Shareholders’ equity
= 100 × 4,332 ÷ 16,893 = 25.64%
2 Adjusted ROE = 100 × Net income ÷ Adjusted shareholders’ equity
= 100 × 4,332 ÷ 12,700 = 34.11%
| Profitability ratio | Description | The company |
|---|---|---|
| Adjusted ROE | A profitability ratio calculated as net income divided by adjusted shareholders’ equity. | NVIDIA Corp. adjusted ROE deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
Adjusted Return on Assets (ROA)
Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-26), 10-K (reporting date: 2019-01-27), 10-K (reporting date: 2018-01-28), 10-K (reporting date: 2017-01-29), 10-K (reporting date: 2016-01-31).
2021 Calculations
1 ROA = 100 × Net income ÷ Total assets
= 100 × 4,332 ÷ 28,791 = 15.05%
2 Adjusted ROA = 100 × Net income ÷ Adjusted total assets
= 100 × 4,332 ÷ 24,598 = 17.61%
| Profitability ratio | Description | The company |
|---|---|---|
| Adjusted ROA | A profitability ratio calculated as net income divided by adjusted total assets. | NVIDIA Corp. adjusted ROA deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |