Qualcomm Inc. (NASDAQ:QCOM)

Net operating profit after taxes (NOPAT)

The net operating profit after taxes exhibited significant fluctuation over the observed periods. It increased sharply from approximately 4,798 million US dollars to a peak of 13,145 million by the third period. However, a notable decline occurred in the fourth period, falling to 5,865 million. Subsequently, it resumed an upward trajectory, reaching 9,896 million by the final period, though it did not surpass the earlier peak.

Invested capital

Invested capital showed a steady increase throughout the periods analyzed. Starting from about 17,459 million US dollars, it consistently rose to 31,317 million by the last period, with only a minor slight decrease observed between the fourth and fifth intervals.

Return on invested capital (ROIC)

ROIC demonstrated considerable variability. It rose significantly from 27.48% to a maximum of 45.12% in the third period, indicating increasing efficiency in capital utilization. Nevertheless, it then dropped sharply to 18.69% in the fourth period, followed by a recovery that led to 31.6% by the final period. Despite the rebound, ROIC did not return to its previous peak level.

Overall analysis

The data indicates a phase of rapid growth in profitability and capital efficiency in the early periods, marked by rising NOPAT and ROIC. This was accompanied by a steady accumulation of invested capital. The subsequent downturn in both NOPAT and ROIC in the fourth period suggests operational challenges or increased costs affecting profitability and capital returns temporarily. The later periods show signs of recovery and improved performance, though not to the highest earlier levels. The consistent increase in invested capital reflects ongoing investments or asset growth, which may be linked to strategic initiatives or expansion efforts.

The analysis of the financial metrics over the reported periods reveals several noteworthy trends and fluctuations.

Operating Profit Margin (OPM)

The operating profit margin shows variability over the six-year span. It starts at 24.17% in 2020 and peaks at 35.06% in 2022, indicating an improvement in operational efficiency and profitability during this period. Subsequently, it declines sharply to 21.48% in 2023 but recovers moderately to 28.26% by 2025. This pattern suggests a period of volatility possibly influenced by external or internal factors impacting operating expenses or revenues.

Turnover of Capital (TO)

The turnover of capital exhibits a generally positive trend with some fluctuations. Beginning at 1.33 in 2020, it increases to 1.66 by 2021, decreases slightly to 1.5 in 2022, and then dips further to 1.14 in 2023. It recovers gradually to 1.42 in 2025. These changes indicate varying levels of efficiency in utilizing capital to generate revenue over the years, with a notable low point in 2023.

Effective Cash Tax Rate (CTR)

Expressed here as 1 minus the effective cash tax rate, this metric decreases from a high of approximately 86% in 2020–2022 to a lower level of around 77%–79% in the later years. This decline suggests an increase in the effective cash tax rate over time, which may have impacted net profitability and cash flows.

Return on Invested Capital (ROIC)

The ROIC exhibits significant volatility. It rises from 27.48% in 2020 to a peak of 45.12% in 2022, indicating highly efficient use of capital during these years. However, there is a marked decline to 18.69% in 2023, followed by a recovery to 31.6% in 2025. The fluctuation mirrors trends seen in operating margin and turnover of capital, highlighting the challenges in maintaining consistent capital returns.

Overall, the financial indicators demonstrate a phase of growth and profitability improvement through 2022, succeeded by a downturn in 2023, with partial recovery by 2025. Changes in tax rates and capital efficiency appear influential on the return measures. This pattern suggests the company experienced some operational and market challenges affecting its profitability and capital utilization during the mid-period before regaining stability.

The analysis of the financial data over the examined periods reveals several noteworthy trends related to profitability and revenue generation.

Net Operating Profit Before Taxes (NOPBT)

There is a significant fluctuation in net operating profit before taxes across the periods. Starting at 5,591 million US dollars, the figure shows a substantial increase to 15,334 million US dollars by the third period. However, this is followed by a notable decline to 7,667 million US dollars in the fourth period, before recovering to 12,528 million US dollars by the last period. Despite the downturn mid-series, the overall trajectory indicates growth with some volatility.

Adjusted Revenues

The adjusted revenues exhibit a consistent upward trend, rising from 23,135 million US dollars in the first period to 44,328 million US dollars in the last. There is a minor dip in the fourth period to 35,699 million US dollars, but the general movement is positive, reflecting expanding sales or service income.

Operating Profit Margin (OPM)

Operating profitability shows variation, beginning at 24.17% and climbing to a peak of 35.06% in the third period. Subsequently, it falls markedly to 21.48% before partially recovering to 28.26% by the final period. This performance signals fluctuating operational efficiency and cost management, though the margin remains generally robust.

In summary, the company demonstrates solid growth in revenues with some periodic declines. Profitability, both in absolute terms and margin percentage, presents volatility but overall improvement compared to the initial periods. The fluctuating operating profit margin suggests the influence of variable cost pressures or changes in business conditions impacting operational effectiveness.

The financial data over the analyzed periods reveals several key trends in the company's financial performance and operational efficiency.

Adjusted Revenues

The adjusted revenues demonstrate a generally upward trajectory over the years, with notable fluctuations. From approximately $23.1 billion in 2020, revenues surged to a peak of about $43.7 billion in 2022. This was followed by a decline to nearly $35.7 billion in 2023, indicating a potential impact from market or operational factors during that period. Revenues then rebounded to $38.9 billion in 2024 and further increased to $44.3 billion in 2025, suggesting recovery and growth momentum in the more recent periods.

Invested Capital

Invested capital consistently increased over the years, beginning at roughly $17.5 billion in 2020 and growing steadily to $31.3 billion by 2023. Although there was a slight decrease to $30.9 billion in 2024, the invested capital rose again to $31.3 billion in 2025. This pattern points to ongoing investments in capital assets or working capital, with a relatively stable level maintained in the last two years of the data.

Turnover of Capital (TO)

The turnover of capital ratio experienced variability across the periods. It started at 1.33 in 2020, improved to 1.66 in 2021, indicating enhanced efficiency in utilizing capital to generate revenues. However, the ratio dropped to 1.5 in 2022 and further declined to its lowest point of 1.14 in 2023, corresponding with the drop in revenues and increased capital investment. In the last two years, the ratio recovered to 1.26 in 2024 and increased further to 1.42 in 2025, reflecting improved capital utilization efficiency relative to the invested capital and revenue generation.

Overall, the data portrays a company navigating through periods of rapid revenue growth followed by a temporary contraction, while consistently increasing its invested capital. The efficiency of capital use, as measured by turnover of capital, has fluctuated but shows recovery in the most recent years, indicating an improved balance between asset investment and revenue production.

Cash Operating Taxes

There is a clear upward trend in cash operating taxes over the analyzed periods. Starting at 793 million US dollars in 2020, the figure increased substantially, reaching 2,632 million by 2025. The increases were particularly steep between 2020 and 2022, with slight fluctuations thereafter but maintaining a generally rising trajectory.

Net Operating Profit Before Taxes (NOPBT)

NOPBT showed considerable growth from 5,591 million US dollars in 2020 to a peak of 15,334 million in 2022. However, a significant decline occurred in 2023, dropping to 7,667 million, before recovering gradually to 12,528 million in 2025. This pattern suggests volatility in operating profitability during the period, with a marked dip in 2023 followed by partial recovery.

Effective Cash Tax Rate (CTR)

The effective cash tax rate remained relatively stable around 14% from 2020 to 2022 but then increased sharply to 23.51% in 2023. Subsequently, the rate decreased slightly to approximately 20-21% in the following years. This indicates a notable rise in tax burden in 2023, impacting the company's tax efficiency, before a modest reduction but maintaining a higher level than in the initial years.

Overall Analysis

The data points to a period marked by initial growth in profitability and taxes paid, followed by a sharp contraction in operating profits in 2023 which coincides with an increased effective tax rate. Despite the recovery of profits in subsequent years, the tax rate remained elevated compared to earlier periods, leading to continuing higher cash taxes paid. This suggests the company experienced challenges affecting profits and tax efficiency around 2023 but showed resilience in returning to growth afterward.