NVIDIA Corp. (NASDAQ:NVDA)

The analyzed financial data reveals notable trends in key performance indicators over the six-year period.

Net Operating Profit After Taxes (NOPAT)

NOPAT shows an overall upward trajectory with fluctuations. It rose from $2,792 million in 2020 to $9,602 million in 2022, indicating a strong growth phase. However, in 2023, there was a considerable decline to $2,334 million. Subsequent years demonstrate a sharp recovery and substantial increase, reaching $27,819 million in 2024 and further surging to $68,707 million in 2025.

Cost of Capital

The cost of capital remains relatively stable throughout the period, hovering around 21.4% to 21.65%. Minor variations appear but no significant upward or downward trend is evident, suggesting consistent financing costs over time.

Invested Capital

Invested capital shows a persistent increase, expanding from $14,224 million in 2020 to $47,433 million in 2025. The growth accelerates especially after 2022, reflecting increased investment or expansion in capital assets.

Economic Profit

Economic profit exhibits substantial variability. It begins with a negative value of -$256 million in 2020, turning positive to $1,615 million in 2021, and rising further to $5,743 million in 2022. In 2023, economic profit turns negative again at -$2,232 million, but rebounds dramatically in the following years, reaching $21,094 million in 2024 and peaking at $58,436 million in 2025. This pattern suggests episodic fluctuations in value creation relative to capital costs, with marked improvement in the latest years.

In summary, the data reflects a pattern of accelerating growth in profitability and invested capital, with a relatively stable cost of capital. Despite some volatility in economic profit and NOPAT around 2023, the overall trend indicates significant enhancement in the company's financial performance and value generation by 2025.

The financial data reveals significant fluctuations and overall growth in key profitability metrics over the observed periods.

Net Income

The net income shows a general upward trend from January 26, 2020, to January 26, 2025, starting at $2,796 million and increasing markedly to $72,880 million. A notable surge occurs between January 29, 2023 ($4,368 million) and January 28, 2024 ($29,760 million), followed by a further sharp increase to $72,880 million in the subsequent period. Despite a dip after January 30, 2022 ($9,752 million) down to $4,368 million by January 29, 2023, the overall trajectory is strongly positive.

Net Operating Profit After Taxes (NOPAT)

NOPAT values follow a similar pattern to net income, starting at $2,792 million in January 26, 2020 and increasing substantially by January 26, 2025 to $68,707 million. This metric also exhibits a decline from $9,602 million in January 30, 2022 to $2,334 million in January 29, 2023, before recovering dramatically to $27,819 million in January 28, 2024 and continuing to grow significantly in the final period.

Overall, the data indicates periods of volatility around early 2023, with decreases in profitability metrics, followed by a strong recovery and exceptional growth leading into 2024 and 2025. This suggests that while the company experienced some operational and financial challenges in the mid-period, it managed to capitalize on conditions or strategic initiatives leading to a substantial increase in profitability towards the end of the analysis window.

Income tax expense (benefit)

Over the analyzed periods, the income tax expense exhibits a volatile trend. Initially, it decreased from 174 million US dollars in early 2020 to 77 million in early 2021, followed by an increase to 189 million in early 2022. The figure then shifted to a negative value (-187 million) in early 2023, indicating a tax benefit during that year. Subsequently, there was a sharp and substantial increase to 4,058 million in early 2024, which further escalated to 11,146 million in early 2025, reflecting significantly rising tax expenses in the most recent years.

Cash operating taxes

Cash operating taxes demonstrate a consistent and pronounced upward trend throughout the period. Starting at 134 million US dollars in early 2020, the cash taxes increased steadily each year, reaching 390 million in 2021, 643 million in 2022, and 1,983 million in 2023. The upward trajectory accelerates substantially in the final years analyzed, with cash operating taxes rising to 6,430 million in early 2024 and then more than doubling to 15,316 million by early 2025. This indicates a growing cash tax outflow from operations over the years under review.

Total Reported Debt & Leases

The total reported debt and leases demonstrated a marked increase from 2,643 million USD in early 2020 to a peak of 12,031 million USD by early 2023, reflecting a significant rise in financial obligations over this period. Subsequently, a downward trend is observed, with the amount decreasing to 11,056 million USD in early 2024 and further to 10,270 million USD by early 2025. Despite this recent reduction, the debt level remains substantially elevated compared to the 2020 baseline.

Shareholders’ Equity

Shareholders’ equity exhibited strong and consistent growth throughout the timeframe. Starting at 12,204 million USD in early 2020, it increased to 16,893 million USD by early 2021, followed by a substantial surge to 26,612 million USD in early 2022. While a slight decline occurred in early 2023, falling to 22,101 million USD, equity then rose sharply to 42,978 million USD in 2024 and reached an impressive 79,327 million USD by early 2025. This upward trajectory indicates a significant accumulation of net assets and possibly improved retained earnings or capital inflows.

Invested Capital

Invested capital showed fluctuation early in the period, declining from 14,224 million USD in early 2020 to 13,232 million USD in early 2021 before ascending steadily to 18,075 million USD in early 2022. This growth continued, reaching 21,396 million USD in early 2023, followed by a notable increase to 31,144 million USD in 2024. The trend culminated with a substantial rise to 47,433 million USD by early 2025. This progression implies increased investment in operational assets or expansion activities over time.

Summary

Overall, the data reveal a strategy characterized by elevated leveraging during the initial years, followed by gradual deleveraging beginning in 2023. Concurrently, both shareholders’ equity and invested capital have grown robustly, with equity growth outpacing that of debt, indicating strengthening financial stability and capital base. The significant rise in invested capital aligns with the reported equity increase, suggesting sustained investment in growth and asset development. These patterns collectively point to an expansion phase supported by increased capital investments alongside active management of debt levels.

Economic Profit

The economic profit demonstrated considerable variability over the reported periods. Initially, it was negative at -256 million USD in early 2020, followed by a substantial increase to 1,615 million USD in early 2021. This upward trend continued strongly into early 2022, reaching 5,743 million USD. However, in early 2023, economic profit declined sharply into negative territory at -2,232 million USD. The subsequent years saw a remarkable recovery with a significant surge to 21,094 million USD in early 2024 and further growth to 58,436 million USD by early 2025.

Invested Capital

Invested capital showed a consistent upward trend throughout the periods observed. Starting at 14,224 million USD in early 2020, there was a slight decline in early 2021 to 13,232 million USD. Following this dip, the invested capital increased steadily year-over-year, reaching 18,075 million USD in early 2022, 21,396 million USD in early 2023, 31,144 million USD in early 2024, and attaining 47,433 million USD by early 2025. This suggests ongoing investment and asset expansion over time.

Economic Spread Ratio

The economic spread ratio, which reflects the profitability spread relative to invested capital, exhibited significant fluctuations. In early 2020, it was negative at -1.8%, indicating that returns were below cost. This ratio substantially improved to 12.21% in early 2021 and further increased to 31.77% in early 2022, signifying strong value creation. In early 2023, the ratio fell sharply to -10.43%, marking a period of value destruction. Subsequently, the spread ratio rebounded impressively to 67.73% in early 2024 and soared to 123.2% by early 2025, highlighting exceptional profitability relative to invested capital in the most recent years.

Overall Observations

The data reveals a pattern of volatile economic performance with notable recoveries and expansions in the latter years. Despite setbacks in 2023, both economic profit and the economic spread ratio achieved extraordinary growth by 2025. This performance aligns with a growing invested capital base, suggesting that the company has been effective in managing its investments to generate substantial economic value over time.

The financial data over the periods from January 26, 2020, to January 26, 2025, exhibits substantial fluctuations and a strong overall upward trajectory in key financial metrics.

Economic Profit

The economic profit shows significant volatility. It begins with a negative value of -256 million US dollars in early 2020, then rises sharply to 1,615 million US dollars by early 2021, and further escalates to 5,743 million US dollars in early 2022. This positive trend is interrupted in early 2023, where economic profit turns strongly negative again at -2,232 million US dollars. However, the subsequent years show a dramatic recovery with economic profit reaching 21,094 million US dollars in early 2024 and further increasing to 58,436 million US dollars by early 2025. The data indicate a cycle of losses and gains, marked by a substantial increase in economic profit in the latest periods.

Adjusted Revenue

Adjusted revenue demonstrates a consistent and steep upward trend throughout the analyzed time frame. Starting at 10,981 million US dollars in early 2020, revenue experiences steady growth each year, reaching 16,925 million in early 2021, 26,965 million in early 2022, and slightly increasing to 27,044 million in early 2023. A notable surge occurs thereafter, with revenue more than doubling to 61,687 million in early 2024 and then more than doubling again to 130,973 million US dollars by early 2025. This pattern evidences rapid expansion in the company's revenues, particularly in the latter periods.

Economic Profit Margin

The economic profit margin follows a pattern roughly corresponding with the economic profit figures. It starts at a negative 2.33% in early 2020, improves significantly to 9.54% in early 2021, and grows further to 21.3% in early 2022. However, this margin also turns negative at -8.25% in early 2023, reflecting the dip seen in economic profit. The margin then exhibits a marked recovery, increasing substantially to 34.2% in early 2024 and reaching 44.62% by early 2025. These figures indicate enhanced profitability relative to revenue in the more recent periods.

In summary, the data reveal a pattern of initial losses followed by strong profitability and growth. Despite a temporary downturn in early 2023, both economic profit and profit margin rebound significantly. Meanwhile, adjusted revenue shows sustained growth, supporting overall financial expansion. The considerable increases in economic profit and margins in the most recent years imply improved operational efficiency and value generation.