NVIDIA Corp. (NASDAQ:NVDA)

The analysis of the financial ratios over the six-year period indicates several notable trends in asset utilization and efficiency metrics.

Net Fixed Asset Turnover

This ratio demonstrates significant growth from 6.52 in early 2020 to 20.77 in early 2025. Although there was a decline from 2022 (9.69) to 2023 (7.09), the overall trajectory is upward, indicating an increasing efficiency in generating sales from net fixed assets over time.

Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)

This adjusted ratio also follows a similar upward pattern, rising from 4.76 in early 2020 to 16.16 in early 2025. Despite a dip between 2022 (7.46) and 2023 (5.57), the increase thereafter suggests improved utilization of fixed assets when factoring in lease-related assets.

Total Asset Turnover

The total asset turnover ratio starts at 0.63 in early 2020, slightly decreases in 2021 (0.58), fluctuates modestly through 2022 and 2023, and then experiences a marked increase from 0.65 to 1.17 by early 2025. This reflects enhanced overall asset efficiency in generating revenues towards the end of the period.

Equity Turnover

This ratio shows a consistent upward movement from 0.89 in early 2020 to 1.65 in early 2025, highlighting improved revenue generation relative to shareholders’ equity over the timeframe.

Overall, the data reveals a general trend of improving asset and equity utilization over the observed years, with temporary declines in fixed asset turnover metrics around 2023, followed by substantial recovery and growth. The enhancements in turnover ratios imply enhanced operational efficiency and potentially better management of capital assets and equity resources in recent years.

Revenue

The revenue demonstrates a strong upward trend over the six-year period. Starting at 10,918 million US dollars in 2020, it increased steadily each year, reaching 16,675 million in 2021 and 26,914 million in 2022. The growth rate appeared to stabilize between 2022 and 2023, with a marginal increase to 26,974 million. However, a significant acceleration occurred thereafter, with revenue more than doubling to 60,922 million in 2024 and further surging to 130,497 million in 2025. This indicates a robust expansion in the company's sales or service capabilities during the latter years.

Property and equipment, net

The net value of property and equipment also experienced consistent growth throughout the analysis period, increasing from 1,674 million US dollars in 2020 to 2,149 million in 2021, 2,778 million in 2022, and 3,807 million in 2023. The upward trend continued with moderate growth to 3,914 million in 2024, followed by a more pronounced increase to 6,283 million in 2025. This progression reflects ongoing capital investment likely aimed at supporting the expanding operations and revenue growth.

Net fixed asset turnover

The net fixed asset turnover ratio, which measures how efficiently the firm uses its fixed assets to generate revenue, fluctuated over the period but generally showed considerable improvement. After an initial increase from 6.52 in 2020 to a peak of 9.69 in 2022, the ratio declined to 7.09 in 2023. A sharp rise occurred in the subsequent years, reaching 15.57 in 2024 and peaking at 20.77 in 2025. The higher ratios in the most recent years indicate enhanced efficiency in asset utilization, which may be attributed to greater revenue generation relative to fixed asset investment.

Revenue

The revenue shows a strong upward trend over the observed periods, increasing significantly from $10,918 million in early 2020 to $130,497 million by early 2025. This represents a more than tenfold increase over five years, indicating substantial growth in sales or service income. The growth appears exponential, with notable jumps particularly from 2023 to 2024 and continuing into 2025.

Property and Equipment, Net

The net property and equipment balance has steadily increased from $2,292 million in 2020 to $8,076 million in 2025. This gradual increase suggests ongoing investment in fixed assets, including operating lease right-of-use assets. Though the growth is consistent, it is relatively moderate compared to the rapid expansion in revenue.

Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)

This ratio, which measures the efficiency of fixed assets in generating revenue, fluctuates but shows a general upward trend. Starting at 4.76 in 2020, it peaks at 7.46 in 2022, dips to 5.57 in 2023, and then rises sharply to 11.58 in 2024 and further to 16.16 in 2025. The significant increase in turnover in the later years indicates improved asset utilization, suggesting the company is generating considerably more revenue per unit of fixed asset.

Overall Analysis

The data points to robust business expansion primarily driven by rapidly increasing revenue and better utilization of fixed assets. The relatively slower growth of property and equipment compared to revenue indicates efficient asset management. The marked increase in net fixed asset turnover in the final years highlights enhanced operational efficiency or possibly scaling effects from previous capital investments.

Revenue

Revenue shows a consistent upward trend from 10,918 million USD in January 2020 to 130,497 million USD in January 2025. The growth accelerates significantly after January 2023, with revenue more than doubling from 26,974 million USD to 60,922 million USD in January 2024, and then more than doubling again to 130,497 million USD by January 2025. This indicates robust business expansion and successful revenue generation strategies over the observed period.

Total Assets

Total assets increased steadily from 17,315 million USD in January 2020 to 44,187 million USD in January 2022, followed by a slight decline to 41,182 million USD in January 2023. After this dip, total assets rose sharply to 65,728 million USD by January 2024 and then increased further to 111,601 million USD in January 2025. The pattern suggests significant investments or acquisitions after 2023 which contributed to asset growth, supporting the scaling of operations.

Total Asset Turnover

The total asset turnover ratio remained relatively stable with minor fluctuation between 0.58 and 0.65 from January 2020 through January 2023, indicating steady efficiency in using assets to generate revenue. However, the ratio experienced notable improvement thereafter, rising sharply to 0.93 in January 2024 and reaching a high of 1.17 by January 2025. This suggests enhanced asset utilization and operational efficiency in the last two periods, aligning with the substantial revenue growth observed.

Revenue

The revenue exhibits a consistent and substantial growth trajectory over the analyzed periods. Starting at approximately $10.9 billion in early 2020, revenue increased significantly each year, culminating in a steep rise to about $130.5 billion by early 2025. Notably, the jump from early 2023 to early 2024 is particularly pronounced, suggesting accelerated business expansion or market demand during that interval.

Shareholders’ equity

Shareholders' equity also demonstrates an upward trend across the timeframe, growing from around $12.2 billion in 2020 to over $79.3 billion by 2025. There is a temporary decrease observed between 2022 and 2023, where equity declined from approximately $26.6 billion to $22.1 billion before resuming growth. This dip may indicate a period of higher dividends, share repurchases, losses, or other equity adjustments.

Equity turnover

The equity turnover ratio shows a steady increase, rising from 0.89 in 2020 to 1.65 by 2025. This upward movement indicates that the company has been generating higher revenue per dollar of equity over the years, suggesting improved efficiency in the use of equity capital to drive sales. The consistent increase implies enhanced operational effectiveness or stronger market penetration during this period.