Super Micro Computer Inc. (NASDAQ:SMCI)

Asset Turnover

The reported total asset turnover exhibited a declining trend from 2.08 in 2019 to a low of 1.53 in 2024, with fluctuations along the way. The adjusted total asset turnover mirrored this pattern, starting at 2.13 in 2019, declining to 1.6 by 2024 after peaking at 2.05 in 2023. This suggests a general decrease in the efficiency with which the company uses its assets to generate sales over the analyzed period.

Liquidity Ratios (Current Ratio)

The reported current ratio showed some volatility, declining from 2.35 in 2019 to 1.91 in 2022 before increasing significantly to 3.81 in 2024. The adjusted current ratio followed a similar trajectory, moving from 2.84 in 2019 down to 2.08 in 2022, then surging to 4.17 in 2024. This indicates an improvement in the company’s short-term liquidity position, particularly in the most recent years.

Leverage Ratios

The reported debt to equity ratio remained low compared to typical industry standards but increased notably in 2022 to 0.42, dropping back to 0.4 in 2024 after a dip to 0.15 in 2023. The adjusted debt to equity ratio followed this pattern closely. Likewise, the reported debt to capital ratio increased from 0.02 in 2019 to 0.29 in 2024, reflecting a gradual rise in financial leverage. The adjusted debt to capital ratio behavior was consistent with the reported figures. These trends imply a moderate increase in reliance on debt financing over time.

Financial Leverage

The reported financial leverage ratio rose from 1.79 in 2019 to a peak of 2.25 in 2022, then decreased to 1.81 by 2024. The adjusted financial leverage increased steadily from 1.48 in 2019, reaching 1.96 in 2022 before declining slightly toward 1.72 in 2024. These figures suggest that while the company’s use of debt and equity to finance assets increased, it retreated somewhat in the last two years.

Profitability Metrics

The reported net profit margin displayed a strong upward trend, moving from 2.05% in 2019 to a peak of 8.98% in 2023, followed by a slight decrease to 7.69% in 2024. The adjusted net profit margin showed a less consistent pattern but generally improved from 3.32% in 2019 to 7.28% in 2024. This indicates enhanced profitability over time, although adjusted figures suggest some variability.

Return on Equity (ROE)

The reported ROE exhibited significant growth, rising from 7.64% in 2019 to 32.45% in 2023 before declining to 21.28% in 2024. Adjusted ROE broadly followed the same trend but with lower values in the mid-period, rising to 29.06% in 2023 and decreasing to 20.03% in 2024. This pattern reflects considerable improvement in the efficiency of equity usage for generating profits, with some recent moderation.

Return on Assets (ROA)

Reported ROA increased from 4.27% in 2019 to 17.42% in 2023, subsequently declining to 11.73% in 2024. The adjusted ROA demonstrated a similar trend, moving from 7.08% in 2019 to 17.61% in 2023 and slightly decreasing to 11.62% in 2024. These rising returns on assets indicate better management effectiveness in utilizing assets to generate income over the period, with some reduction in the final year.

Net Sales and Adjusted Net Sales

Net sales show a fluctuating but overall strong upward trend over the six-year period. Beginning at 3.5 billion USD in 2019, there was a slight decline in 2020 followed by steady recovery and substantial growth reaching nearly 15 billion USD by 2024.

Adjusted net sales closely follow the pattern of net sales, with minor variations, confirming the consistency of revenue reporting. Adjusted figures also peak in 2024, surpassing 15 billion USD, indicating robust sales growth.

Total Assets and Adjusted Total Assets

Total assets consistently increased each year, rising from approximately 1.68 billion USD in 2019 to over 9.8 billion USD by 2024. This suggests significant investment in asset base expansion, potentially to support the increased sales volume.

Adjusted total assets follow a similar growth pattern, although with slightly lower values than reported totals. The adjusted asset figures confirm a steady accumulation of resources, reaching nearly 9.5 billion USD in 2024, which is indicative of the company's scaling operations.

Reported Total Asset Turnover

The reported total asset turnover ratio declines from 2.08 in 2019 to a low of 1.59 in 2021, indicating decreasing efficiency in generating sales from assets during that span. It somewhat recovers to 1.94 in 2023 before decreasing again to 1.53 in 2024.

This fluctuation suggests periods of varying operational efficiency or changes in asset utilization, likely influenced by the rapid asset growth outpacing sales increases in certain years.

Adjusted Total Asset Turnover

The adjusted total asset turnover mirrors the reported ratio, starting at 2.13 in 2019, falling to 1.63 in 2021, then recovering to a peak of 2.05 in 2023 before declining to 1.6 in 2024. This pattern reflects similar dynamics in asset efficiency as the reported figures.

Summary Insight

The company has demonstrated substantial growth in both sales and asset base over the six-year period, with sales expanding more rapidly than assets in certain periods, but asset growth accelerating markedly in the latest year.

The decline in asset turnover ratios in later years, especially in 2024, could indicate that asset expansion has outpaced sales growth, potentially signaling a need to focus on improving asset utilization efficiency.

Overall, the data reflects a company in an aggressive growth phase with increasing scale, but also facing challenges in maintaining consistent operational efficiency.

Current Assets

The current assets have exhibited a generally increasing trend over the years, rising from 1,421,771 thousand US dollars in mid-2019 to 3,179,426 thousand in mid-2023. A significant surge is observed by mid-2024, where the value nearly triples to 8,931,960 thousand, indicating a substantial increase in liquid or short-term assets.

Current Liabilities

Current liabilities also show a consistent upward trajectory, increasing from 605,969 thousand US dollars in 2019 to 1,374,652 thousand in 2023. By mid-2024, current liabilities rise sharply to 2,345,721 thousand, which aligns with the notable increase in current assets, though the growth rate is somewhat more moderate compared to assets.

Reported Current Ratio

The reported current ratio, which measures liquidity by dividing current assets by current liabilities, starts at 2.35 in 2019 and experiences a decline through 2022 to 1.91, reflecting tighter liquidity conditions. The ratio recovers somewhat in 2023 to 2.31 and accelerates markedly by 2024 to 3.81, illustrating a strengthened short-term financial position driven by the sharp increase in current assets relative to liabilities.

Adjusted Current Assets

The adjusted current assets closely mirror the trend of reported current assets, rising steadily from 1,430,677 thousand in 2019 to 3,179,508 thousand in 2023 and then experiencing a substantial increase to 8,932,033 thousand by 2024. This similarity indicates that adjustments made are minimal but consistent over time.

Adjusted Current Liabilities

Adjusted current liabilities follow a similar upward trend as reported liabilities but remain consistently lower in value, growing from 503,155 thousand in 2019 to 1,230,906 thousand in 2023, and then rising sharply to 2,142,660 thousand in 2024. The lower adjusted figures suggest exclusions or refinements that reduce the liability base for analysis, but overall growth aligns with the reported liabilities.

Adjusted Current Ratio

The adjusted current ratio shows a decreasing pattern from 2.84 in 2019 to 2.08 in 2022, reflecting progressively tighter liquidity conditions during this period. Following this, a recovery is evident, with the ratio increasing to 2.58 in 2023 and substantially rising to 4.17 in 2024. This pattern suggests improved liquidity and a stronger capacity to cover short-term obligations when adjustments are considered.

Summary of Trends

Overall, liquidity indicators demonstrate a decline in the firm's short-term financial strength from 2019 through 2022, as both reported and adjusted current ratios decrease. However, a marked improvement occurs in 2023 and becomes pronounced in 2024, driven by exceptional growth in current assets far outpacing increases in current liabilities. This shift implies enhanced liquidity, likely providing greater operational flexibility and financial stability in the most recent period.

Total Debt

The total debt exhibits a significant upward trend from 2019 to 2024, with a marked acceleration observed between 2021 and 2024. Initially at $23.6 million in 2019, it surged sharply to $596.8 million in 2022, before fluctuating and reaching a peak of approximately $2.17 billion in 2024. This reflects a substantial increase in the company's leverage over the period.

Total Stockholders’ Equity

Stockholders’ equity consistently increased year over year across the analyzed periods, rising from $941 million in 2019 to $5.42 billion in 2024. The growth accelerated particularly after 2021, indicating a strengthening equity base, which suggests reinvestment of earnings or capital raises were substantial during this timeframe.

Reported Debt to Equity Ratio

The reported debt to equity ratio remained relatively low through 2019 and 2020 at 0.03, increased notably to 0.42 by 2022, then decreased to 0.15 in 2023, before ascending again to 0.4 in 2024. This pattern aligns with the fluctuations seen in total debt, denoting periods of increased leverage followed by partial deleveraging, and a further increase in leverage by the latest period.

Adjusted Total Debt

Adjusted total debt trends mirror that of total debt but with consistently higher values, starting at $41.1 million in 2019 and reaching $2.21 billion in 2024. The adjusted figures amplify the observed leverage trend, reinforcing the conclusion of significant debt growth over the period.

Adjusted Total Stockholders’ Equity

Adjusted equity values also show a steady increase, starting at approximately $1.12 billion in 2019 and reaching $5.49 billion by 2024. This further supports the consistent strengthening of the equity base under adjusted measurements.

Adjusted Debt to Equity Ratio

The adjusted debt to equity ratio follows a similar trajectory to the reported ratio, beginning at 0.04 in 2019, peaking near 0.39 in 2022, dipping to 0.15 in 2023, and rising back to 0.4 by 2024. This confirms the overall leverage fluctuations, suggesting cyclical or strategic financial management decisions impacting the company’s capital structure.

Total Debt

The total debt experienced a significant upward trend over the observed periods. It increased moderately from 23,647 thousand USD in mid-2019 to 29,401 thousand USD in mid-2020. This was followed by a more pronounced surge to 98,190 thousand USD in 2021. A sharp escalation occurred in 2022, with total debt reaching 596,764 thousand USD. Despite a subsequent decline to 290,302 thousand USD in 2023, the figure escalated dramatically again by 2024, peaking at 2,174,145 thousand USD.

Total Capital

Total capital exhibited a steady and consistent increase across all years. Starting from 964,662 thousand USD in 2019, it grew to 1,094,941 thousand USD in 2020, and continued to rise to 1,194,415 thousand USD in 2021. The growth accelerated substantially in 2022, reaching 2,022,339 thousand USD, followed by an increase to 2,262,307 thousand USD in 2023. The most significant leap occurred in 2024, with total capital reaching 7,591,351 thousand USD.

Reported Debt to Capital Ratio

The reported debt to capital ratio showed notable fluctuations. It remained relatively low between 2019 and 2020, rising slightly from 0.02 to 0.03. The ratio then increased to 0.08 in 2021, followed by a substantial jump to 0.30 in 2022, indicating a higher leverage level during that year. In 2023, the ratio decreased to 0.13, suggesting deleveraging, but rose again to 0.29 in 2024, nearing the prior peak.

Adjusted Total Debt

Adjusted total debt mirrored the pattern observed in the reported total debt but with higher absolute values. It increased steadily from 41,119 thousand USD in 2019 to 53,813 thousand USD in 2020 and then rose sharply to 119,051 thousand USD in 2021. A significant jump occurred in 2022 to 620,564 thousand USD. Although it dropped to 309,462 thousand USD in 2023, it subsequently surged to 2,209,527 thousand USD in 2024, indicating increased financing or liabilities adjustments.

Adjusted Total Capital

Adjusted total capital followed a rising trend throughout the years. From 1,164,528 thousand USD in 2019, it increased to 1,285,356 thousand USD in 2020 and then to 1,369,932 thousand USD in 2021. A more pronounced increase was observed in 2022 with 2,224,133 thousand USD, followed by a rise to 2,438,367 thousand USD in 2023. The largest increase occurred in 2024 with a value of 7,695,989 thousand USD.

Adjusted Debt to Capital Ratio

The adjusted debt to capital ratio maintained a relatively stable low level around 0.04 in 2019 and 2020, increasing moderately to 0.09 in 2021. It then rose markedly to 0.28 in 2022, reflecting increased leverage, before falling to 0.13 in 2023. In 2024, the ratio surged again to 0.29, suggesting an elevated leverage position similar to the previous peak.

Overall Analysis

The data reveals a substantial increase in both debt and capital over the six-year period, with pronounced growth particularly evident in the years 2022 and 2024. Debt levels displayed volatility with significant spikes and partial retrenchments, while capital consistently increased, suggesting ongoing capital formation or equity injections. The debt to capital ratios, both reported and adjusted, indicate periods of higher leverage beginning in 2021, peaking in 2022, diminishing in 2023, and rising again in 2024. These trends suggest strategic financing decisions with fluctuating reliance on debt, likely reflecting changing operational or market conditions and capital structure management.

The financial data reveals several notable trends regarding assets, equity, and financial leverage over the observed periods.

Total Assets

Total assets exhibit a consistent upward trajectory throughout the years. Beginning at approximately US$1.68 billion in mid-2019, the total escalated steadily to US$3.67 billion by mid-2023 and experienced a significant surge to roughly US$9.83 billion by mid-2024. This marked increase in the final year indicates a substantial expansion of asset base.

Total Stockholders’ Equity

Stockholders’ equity also shows a positive growth trend, rising from about US$941 million in 2019 to over US$1.97 billion in 2023. Similar to total assets, equity saw a pronounced jump in mid-2024, reaching approximately US$5.42 billion. The equity growth corresponds with the increase in assets but at a slightly different rate.

Reported Financial Leverage

The reported financial leverage ratio has generally increased from 1.79 in 2019 to a peak of 2.25 in 2022, suggesting increased reliance on debt relative to equity. However, a dip occurred in 2023 to 1.86, and a slight further decrease to 1.81 in 2024, indicating a trend toward reduced leverage or a more balanced capital structure in the most recent periods.

Adjusted Total Assets

Adjusted total assets follow a similar pattern to the reported total assets, rising from roughly US$1.67 billion in 2019 to US$3.51 billion in 2023. The period ending mid-2024 again shows a significant increase to about US$9.46 billion, confirming the company's notable asset base expansion on an adjusted basis.

Adjusted Total Stockholders’ Equity

The adjusted equity increased moderately from about US$1.12 billion in 2019 to US$2.13 billion in 2023, then rose sharply to US$5.49 billion in 2024. This growing equity base on an adjusted level supports the company's strengthening financial position.

Adjusted Financial Leverage

The adjusted financial leverage ratio rose steadily from 1.48 in 2019 to 1.96 in 2022, reflecting increasing leverage. It then decreased to 1.65 in 2023 before rising slightly again to 1.72 in 2024. This pattern suggests fluctuations in the company's capital structure but overall moderate leverage.

In summary, the company has demonstrated strong growth in both assets and equity over the examined period, with a pronounced acceleration in the latest year. Financial leverage, both reported and adjusted, peaked around 2022 before moderating somewhat, indicating potential efforts to control debt levels relative to equity despite heavy expansion. The significant increase in asset and equity values as of mid-2024 may suggest major investment or restructuring activities contributing to the company's enlarged scale.

Net Income

The net income exhibits a consistent and substantial upward trend over the six-year period. Starting at $71.9 million in 2019, it increased to approximately $1.15 billion by 2024. The growth accelerated significantly from 2021 onwards, particularly between 2022 and 2023, where the net income more than doubled. This indicates strong profitability improvements and effective cost management or revenue growth initiatives.

Net Sales

Net sales have shown overall growth with some volatility. Beginning at $3.5 billion in 2019, sales experienced a slight decline in 2020, followed by a recovery and steady increase thereafter. By 2024, net sales had more than quadrupled, reaching nearly $15 billion. The sharp increase between 2022 and 2024 suggests expansion in market reach, product demand, or pricing adjustments driving revenue growth.

Reported Net Profit Margin

The reported net profit margin improved consistently over the period, increasing from 2.05% in 2019 to a peak of 8.98% in 2023 before slightly declining to 7.69% in 2024. This pattern reflects enhanced operational efficiency, better cost controls, or higher-margin revenue streams contributing to profitability.

Adjusted Net Income

Adjusted net income mirrors the net income trend with fluctuations. It began at $118 million in 2019 and rose to approximately $1.1 billion in 2024. Unlike net income, adjusted net income decreased in 2020, which could indicate extraordinary items or one-time adjustments affecting that year. The following years show recovery and strong growth, consistent with the company's improving financial health.

Adjusted Net Sales

Adjusted net sales generally follow the trend of net sales, starting at $3.56 billion in 2019, decreasing slightly in 2020, then steadily increasing to over $15 billion by 2024. The correlation suggests adjustments do not drastically alter the revenue trends but align with reported sales growth.

Adjusted Net Profit Margin

The adjusted net profit margin shows a less consistent but upward overall trend. It started at 3.32% in 2019, dipped to 2.03% in 2020, then rose steadily to 8.6% in 2023 before a slight decline to 7.28% in 2024. This fluctuation may result from the impact of non-recurring expenses or income excluded in adjustments but indicates improving profitability when normalized for such factors.

The financial data over the six-year period demonstrates significant growth and volatility across key metrics, particularly in net income, stockholders’ equity, and return on equity (ROE).

Net Income

Net income has shown a pronounced upward trajectory, increasing from $71.9 million in 2019 to $1.15 billion in 2024. The growth was relatively moderate in the initial three years but accelerated sharply from 2021 onwards, with a remarkable surge between 2021 and 2022, where net income more than doubled. Although there is sustained growth through to 2024, the rate of increase slightly moderates in the latter years.

Total Stockholders’ Equity

Total stockholders’ equity also experienced steady growth, rising from approximately $941 million in 2019 to $5.42 billion in 2024. The increase is consistent and becomes more pronounced starting from 2022, paralleling the rapid increase in net income. This growth suggests a strengthening equity base, likely supporting the company’s expanding operations and profitability.

Reported Return on Equity (ROE)

The reported ROE indicates efficiency in generating profit relative to equity. It improved from 7.64% in 2019 to a peak of 32.45% in 2023, showcasing enhanced profitability and capital utilization. However, in 2024, ROE declines to 21.28%, suggesting some reduction in profitability or increased equity not matched proportionally by net income growth during that year.

Adjusted Net Income

Adjusted net income follows a similar growth pattern to reported net income but begins with a higher base in 2019 ($118 million) and shows a notable dip in 2020, decreasing to approximately $67.8 million. This adjusted figure then recovers and exhibits substantial growth, reaching nearly $1.1 billion in 2024. The large increase after 2020 indicates adjustments either related to one-time items or operational gains that were accounted for separately.

Adjusted Total Stockholders’ Equity

Adjusted equity mirrors the trend of reported equity but starts from a higher base and follows a steady increase over the period, reaching $5.49 billion by 2024. This denotes that after adjustments, the company’s equity base is strong and growing in alignment with its profitability.

Adjusted Return on Equity

Adjusted ROE shows more variability than reported ROE. It decreases from 10.51% in 2019 to a low of 5.51% in 2020, then rises steadily to 29.06% in 2023 before moderating to 20.03% in 2024. This pattern suggests that after certain adjustments, the efficiency ratio fluctuates more markedly, reflecting the impact of underlying operational or non-recurring elements on performance metrics.

The financial data reveals a notable upward trend in net income over the six-year period, increasing from approximately $71.9 million in mid-2019 to around $1.15 billion in mid-2024. This growth indicates a strong improvement in profitability. However, the significant jump in net income between 2021 and 2022, from about $111.9 million to $285.2 million, followed by further substantial increases in the subsequent years, suggests a period of accelerated earnings growth.

Total assets have also shown a consistent increase, nearly doubling from $1.68 billion in 2019 to $9.83 billion in 2024. This expansion in assets indicates substantial growth in the company's scale and resource base. The largest increase is observed between 2023 and 2024, where assets more than doubled, reflecting either significant acquisitions, capital investments, or other asset increases.

Examining return on assets (ROA), both reported and adjusted figures follow a similar pattern. Reported ROA starts around 4.27% in 2019, remains relatively stable until 2021, then rises sharply to a peak of 17.42% in 2023 before declining to 11.73% in 2024. Adjusted ROA mirrors this behavior, moving from 7.08% in 2019, dipping to 3.63% in 2020, then climbing to 17.61% in 2023, and decreasing to 11.62% in 2024. The divergence between reported and adjusted ROA in the earlier years suggests the presence of considerable adjustments impacting profitability measures.

Adjusted net income data reflects a less stable trajectory in the initial years, with a decrease from 2019 to 2020, followed by recovery and strong growth thereafter. The adjusted figures rise from approximately $118.1 million in 2019 to about $1.1 billion in 2024. This volatility in adjusted net income early on might be attributable to one-time charges or other adjustments that were subsequently resolved or outweighed by operational improvements.

Similarly, adjusted total assets follow a pattern closely aligned with reported total assets but are slightly lower in value across all periods. This consistent gap indicates adjustments that reduce asset base figures, potentially reflecting asset revaluations or impairments.

Overall, the data indicates robust growth in earnings and asset base, with improved profitability as measured by ROA in the later years. The peak in ROA around 2023 followed by a decline in 2024 may warrant further analysis to understand the causes. The adjustments between reported and adjusted figures highlight the importance of considering both sets of metrics for a comprehensive assessment of financial performance.