Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
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- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Dividend Discount Model (DDM)
- Operating Profit Margin since 2007
- Return on Assets (ROA) since 2007
- Current Ratio since 2007
- Price to Earnings (P/E) since 2007
- Price to Book Value (P/BV) since 2007
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Economic Profit
Super Micro Computer Inc., economic profit calculation
US$ in thousands
| 12 months ended: | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | |
|---|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | |||||||
| Cost of capital2 | |||||||
| Invested capital3 | |||||||
| Economic profit4 | |||||||
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- The net operating profit after taxes exhibited a fluctuating but overall strong upward trend from 2019 to 2024. Starting at 123,581 thousand USD in 2019, it decreased sharply to 70,352 thousand USD in 2020, followed by a recovery to 103,035 thousand USD in 2021. A significant increase was observed in 2022 and 2023, reaching 314,116 and 627,683 thousand USD respectively, with the highest value recorded in 2024 at 1,116,783 thousand USD. This indicates substantial growth in profitability, particularly in the later years.
- Cost of Capital
- The cost of capital remained relatively stable over the period, fluctuating marginally between 16.37% and 18.72%. The rate saw a slight downward trend until 2022, reaching its lowest point at 16.37%, before rising again to 18.72% in 2023 and slightly declining to 17.77% in 2024. This suggests a consistent cost environment with minor variations.
- Invested Capital
- Invested capital showed a strong upward trajectory overall, with some volatility. It increased moderately from 1,150,419 thousand USD in 2019 to 1,282,041 thousand USD in 2021, followed by a sharp rise to 2,227,919 thousand USD in 2022 and further to 2,437,425 thousand USD in 2023. A dramatic jump occurred in 2024, with invested capital reaching 7,676,769 thousand USD, more than tripling from the prior year. This marked increase suggests substantial capital deployment or asset acquisition in the most recent year.
- Economic Profit
- Economic profit displayed negative values for most years, reflecting that returns did not exceed the cost of capital, except in 2023. Starting at -89,027 thousand USD in 2019, it deepened to -158,939 thousand USD in 2020, then slightly improved to -127,658 thousand USD in 2021 and further to -49,671 thousand USD in 2022. A positive economic profit of 171,309 thousand USD occurred in 2023, indicating value creation during that year. However, this improvement was not sustained, as economic profit fell back into negative territory at -247,105 thousand USD in 2024, despite the substantial increase in NOPAT and invested capital.
Net Operating Profit after Taxes (NOPAT)
Super Micro Computer Inc., NOPAT calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowance for credit losses.
3 Addition of increase (decrease) in deferred revenue.
4 Addition of increase (decrease) in accrued warranty costs.
5 Addition of increase (decrease) in equity equivalents to net income.
6 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
7 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
8 Addition of after taxes interest expense to net income.
9 2024 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =
10 Elimination of after taxes investment income.
The financial data exhibits a significant upward trend in both net income and net operating profit after taxes (NOPAT) over the five-year period.
- Net Income
- Net income increased consistently from 71,918 thousand US dollars in 2019 to 1,152,666 thousand US dollars in 2024. This represents a substantial growth trajectory, with particularly sharp increases observed from 2021 onwards. The most notable surge occurs between 2022 and 2023, where net income more than doubles, followed by continued robust growth into 2024.
- Net Operating Profit After Taxes (NOPAT)
- NOPAT showed some fluctuation in earlier years, decreasing from 123,581 thousand US dollars in 2019 to 70,352 thousand US dollars in 2020. However, starting in 2021, there is a clear recovery and subsequent strong growth, reaching 1,116,783 thousand US dollars in 2024. The pattern of increase closely parallels that of net income, indicating improved operating efficiency and higher profitability from core operations in recent years.
Overall, the financial data suggests a period of transformation characterized by increased profitability and operational improvements, especially evident in the last three years. The upward trend indicates strengthening financial performance and potentially successful strategic initiatives driving both net income and operating profit growth.
Cash Operating Taxes
Super Micro Computer Inc., cash operating taxes calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
The financial data reveals considerable fluctuations in both the income tax provision and cash operating taxes over the examined periods.
- Income Tax Provision
- The income tax provision exhibits a variable trend, initially decreasing sharply from 14,884 thousand USD in 2019 to 2,922 thousand USD in 2020. It then increased moderately to 6,936 thousand USD in 2021, followed by a significant rise to 52,876 thousand USD in 2022. The upward trend continued, reaching a peak of 110,666 thousand USD in 2023, before declining to 63,294 thousand USD in 2024. Overall, despite the volatility, the income tax provision shows a substantial increase from 2019 to 2024, peaking notably in the period ending June 30, 2023.
- Cash Operating Taxes
- Cash operating taxes demonstrate a pronounced upward trend throughout the period analyzed. Starting at 33,161 thousand USD in 2019, they decreased to 17,343 thousand USD in 2020 and slightly declined again to 15,997 thousand USD in 2021. However, from 2022 onward, there is a marked escalation, with cash operating taxes rising to 61,030 thousand USD, then surging significantly to 205,704 thousand USD in 2023, and further increasing to 236,509 thousand USD in 2024. This indicates an increasing cash outflow related to operating taxes in recent years.
In summary, both income tax provision and cash operating taxes have experienced significant increases over the examined time frame, particularly from 2022 onwards. The steep rises in these tax-related expenses suggest substantial changes in taxable income, tax rates, or tax payment strategies, impacting the cash flow and financial position associated with taxation.
Invested Capital
Super Micro Computer Inc., invested capital calculation (financing approach)
US$ in thousands
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of deferred revenue.
5 Addition of accrued warranty costs.
6 Addition of equity equivalents to total Super Micro Computer, Inc. stockholders’ equity.
7 Removal of accumulated other comprehensive income.
8 Subtraction of buildings construction in progress.
9 Subtraction of investment in marketable equity security.
- Total Reported Debt & Leases
- The total reported debt and leases exhibited a fluctuating yet overall increasing trend over the period. Starting at 41,119 thousand USD in 2019, the figure rose moderately to 53,813 thousand USD in 2020 before more than doubling to 119,051 thousand USD in 2021. A substantial spike occurred in 2022, with debt and leases reaching 620,564 thousand USD, followed by a decline to 309,462 thousand USD in 2023. However, in 2024, there was a dramatic surge to 2,209,527 thousand USD, indicating a significant increase in leverage or financing activities in the most recent year.
- Total Stockholders’ Equity
- Stockholders’ equity demonstrated consistent growth throughout the period. Beginning at 941,015 thousand USD in 2019, it increased steadily each year, reaching 1,065,540 thousand USD in 2020, 1,096,225 thousand USD in 2021, and 1,425,575 thousand USD in 2022. The upward trend accelerated in 2023 with equity amounting to 1,972,005 thousand USD, and then showed a marked rise to 5,417,206 thousand USD in 2024. This strong expansion in equity suggests substantial retained earnings or capital injections contributing to the company's net worth over time.
- Invested Capital
- The invested capital followed a gradual upward path initially, increasing from 1,150,419 thousand USD in 2019 to 1,239,197 thousand USD in 2020 and 1,282,041 thousand USD in 2021. A significant jump occurred in 2022, with invested capital reaching 2,222,919 thousand USD, followed by a further increase to 2,437,425 thousand USD in 2023. The most striking change was recorded in 2024, where invested capital more than tripled, reaching 7,676,769 thousand USD. This pronounced increase aligns with the large rise in debt and stockholders’ equity, indicating substantial capital deployment in the company’s assets or operations.
Cost of Capital
Super Micro Computer Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2024-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Lines of credit, term loans, and convertible notes3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2019-06-30).
1 US$ in thousands
2 Equity. See details »
3 Lines of credit, term loans, and convertible notes. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Super Micro Computer Inc., economic spread ratio calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Economic profit1 | |||||||
| Invested capital2 | |||||||
| Performance Ratio | |||||||
| Economic spread ratio3 | |||||||
| Benchmarks | |||||||
| Economic Spread Ratio, Competitors4 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Dell Technologies Inc. | |||||||
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 Economic profit. See details »
2 Invested capital. See details »
3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Economic Profit
- The economic profit exhibited significant fluctuations over the period. Starting with a negative value of -89,027 thousand USD in mid-2019, it deteriorated further to -158,939 thousand USD in 2020. There was a moderate recovery in 2021 to -127,658 thousand USD and a substantial improvement in 2022 to -49,671 thousand USD. In 2023, the economic profit turned positive, reaching 171,309 thousand USD, marking the highest point in the series. However, this upward trend did not continue, as the figure fell sharply to a negative -247,105 thousand USD in 2024. This pattern indicates volatility with a brief positive phase amid primarily negative returns.
- Invested Capital
- The invested capital demonstrated a general upward trend from 2019 through 2023. It increased steadily from 1,150,419 thousand USD in 2019 to 2,437,425 thousand USD in 2023. The most pronounced increase occurred between 2022 and 2023. However, in 2024, there was an exceptional and abrupt rise to 7,676,769 thousand USD, more than tripling the amount from the previous year. This significant jump in invested capital may indicate major investments, acquisitions, or asset appraisals within that fiscal year.
- Economic Spread Ratio
- The economic spread ratio, representing the return spread over invested capital, reflected a pattern consistent with economic profit trends. It was negative throughout most of the period, starting at -7.74% in 2019 and worsening to -12.83% in 2020. A recovery trend was noted in 2021 and 2022, with ratios of -9.96% and -2.23%, respectively. In 2023, the ratio turned positive to 7.03%, aligning with the positive economic profit that year. Yet in 2024, the ratio reverted to negative, falling to -3.22%, which parallels the turnaround to negative economic profit despite the substantial increase in invested capital.
- Summary Insight
- The financial indicators collectively reveal a period marked by volatility and shifting performance results. While invested capital mostly increased, culminating in a dramatic rise in 2024, the returns on that capital, as indicated by economic profit and economic spread ratio, fluctuated considerably. The brief positive performance in 2023 was not sustained, as losses deepened materially in 2024 despite increased capital commitment. This suggests challenges in achieving profitable utilization of the capital base during the most recent period, highlighting potential risks or strategic shifts affecting financial outcomes.
Economic Profit Margin
Super Micro Computer Inc., economic profit margin calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Economic profit1 | |||||||
| Net sales | |||||||
| Add: Increase (decrease) in deferred revenue | |||||||
| Adjusted net sales | |||||||
| Performance Ratio | |||||||
| Economic profit margin2 | |||||||
| Benchmarks | |||||||
| Economic Profit Margin, Competitors3 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Dell Technologies Inc. | |||||||
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 Economic profit. See details »
2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted net sales
= 100 × ÷ =
3 Click competitor name to see calculations.
- Adjusted Net Sales
- The adjusted net sales demonstrate a generally increasing trend over the analyzed periods. Starting from approximately 3.56 billion USD in mid-2019, sales slightly declined to about 3.34 billion USD in mid-2020, followed by a recovery to 3.56 billion USD in mid-2021. Subsequently, there was a notable expansion, reaching 5.23 billion USD in mid-2022, 7.19 billion USD in mid-2023, and a significant peak at 15.1 billion USD by mid-2024. This indicates rapid revenue growth, especially pronounced in the last two years.
- Economic Profit
- The economic profit consistently reflects losses in most periods, with only one positive value observed. The firm reported an economic loss of approximately 89.0 million USD in 2019, which deepened to nearly 158.9 million USD in 2020. There was some improvement in 2021 and 2022, with losses reducing to 127.7 million and 49.7 million USD respectively. A notable positive economic profit of 171.3 million USD occurred in 2023. However, this was followed by a sharp reversal leading to a substantial loss of 247.1 million USD in 2024. The economic profit volatility suggests challenges in balancing revenues and costs or capital charges despite increasing sales.
- Economic Profit Margin
- The economic profit margin, a measure of economic profit relative to sales, aligns with the observed economic profit trends. It was negative throughout most periods, starting at -2.5% in 2019, worsening to -4.76% in 2020, and improving gradually to -0.95% in 2022. In 2023, the margin turned positive at 2.38%, indicating that economic profit exceeded the cost of capital for that year. However, this improvement was short-lived, as the margin declined to -1.64% in 2024. The margin pattern indicates that although sales increased substantially, profitability in terms of economic profit margin was inconsistent and generally negative.
- Overall Insights
- The data reveals robust growth in adjusted net sales over the examined years, particularly accelerating from 2022 onward. Despite this growth, economic profit and its margin exhibit significant volatility, with persistent losses in most years except for a positive outcome in 2023. The fluctuation in economic profitability raises concerns regarding cost management, capital efficiency, or investment returns during periods of sales expansion. The inconsistency between revenue growth and economic profit suggests that increased sales have not consistently translated into sustainable economic value.