Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
3M Co., profitability ratios (quarterly data)
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
The analysis of the financial performance over multiple quarters reveals several important trends concerning profitability and efficiency metrics.
- Gross Profit Margin
- The gross profit margin displayed a generally declining trend from early 2018 through late 2022. Starting above 49% in early 2018, it gradually decreased to around 44% by the end of the observed period. This suggests a gradual erosion of the company's core profitability at the gross level, potentially due to increasing cost of goods sold or pricing pressures.
- Operating Profit Margin
- The operating profit margin showed more variability but also exhibited a downward trajectory over time. Beginning at approximately 22% in early 2018, the margin dipped significantly in mid-2022 to a low around 14.7% before recovering somewhat near the end of the timeline to nearly 21.6%. This fluctuation indicates periods of operational stress or investment, with the mid-2022 dip possibly reflecting increased operating expenses or reduced revenues.
- Net Profit Margin
- Net profit margin trends reflect similar volatility but with relatively less dramatic decline compared to operating margin. The margin trended upward from roughly 13% in 2018 to a peak above 17% in 2021, before declining sharply in mid-2022 to about 11.8%. By the latest period, net margin rebounded strongly to near 19%. This pattern suggests effective management of non-operating expenses and tax impacts, alongside operational fluctuations.
- Return on Equity (ROE)
- The return on equity showed a strong upward movement in 2018 and early 2019, peaking at above 58%. Subsequently, it experienced a steady decline, reaching a low of around 30% in mid-2022, followed by a notable recovery nearing 47% by the last quarter. These trends suggest that while the company initially improved efficiency in generating shareholder returns, late-period challenges diminished profitability, with recent improvements indicating potential recovery.
- Return on Assets (ROA)
- Return on assets illustrated an initial rise through 2018 and 2019, peaking around 14.7%. This was followed by a decline to approximately 9% in mid-2022, then a marked recovery to over 14% by the last reported period. This movement reflects the company’s varying effectiveness in utilizing its asset base to generate net income, with efficiency falling mid-period before regaining strength.
Overall, the data indicates a period of solid profitability and returns early in the timeline, followed by challenges impacting margins and returns around mid-2022. However, the latter periods show signs of operational and financial recovery, suggesting adaptive responses to prior difficulties. The downward pressure on gross and operating margins points to cost and operational challenges, while the recovery in net margin and returns hints at potential improvements in non-operating efficiencies and asset utilization.
Return on Sales
Return on Investment
Gross Profit Margin
3M Co., gross profit margin calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Gross profit | 3,891) | 3,609) | 4,003) | 3,914) | 4,089) | 4,231) | 4,326) | 4,195) | 4,047) | 3,371) | 3,966) | 3,786) | 3,803) | 3,858) | 3,553) | 3,885) | 3,993) | 4,163) | 4,042) | ||||||
| Net sales | 8,619) | 8,702) | 8,829) | 8,612) | 8,942) | 8,950) | 8,851) | 8,583) | 8,350) | 7,176) | 8,075) | 8,111) | 7,991) | 8,171) | 7,863) | 7,945) | 8,152) | 8,390) | 8,278) | ||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Gross profit margin1 | 44.35% | 44.51% | 45.95% | 46.84% | 47.67% | 48.36% | 48.36% | 48.41% | 47.84% | 47.61% | 47.65% | 46.68% | 47.23% | 47.58% | 48.20% | 49.09% | 49.09% | 49.47% | 49.25% | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Gross Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | -1.41% | 2.74% | 3.20% | 4.84% | -0.25% | -1.35% | -7.82% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Caterpillar Inc. | 26.14% | 25.52% | 25.71% | 26.30% | 27.08% | 26.83% | 25.98% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eaton Corp. plc | 32.83% | 32.55% | 32.36% | 32.28% | 32.14% | 32.23% | 30.80% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| GE Aerospace | 24.52% | 25.22% | 24.26% | 24.19% | 24.97% | 22.43% | 18.80% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Honeywell International Inc. | 35.56% | 34.22% | 32.95% | 31.98% | 32.34% | 32.06% | 31.52% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lockheed Martin Corp. | 12.99% | 13.39% | 13.36% | 13.52% | 13.34% | 13.00% | 13.26% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| RTX Corp. | 20.49% | 20.17% | 19.94% | 19.40% | 17.59% | 15.79% | 13.98% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Gross profit margin = 100
× (Gross profitQ3 2022
+ Gross profitQ2 2022
+ Gross profitQ1 2022
+ Gross profitQ4 2021)
÷ (Net salesQ3 2022
+ Net salesQ2 2022
+ Net salesQ1 2022
+ Net salesQ4 2021)
= 100 × (3,891 + 3,609 + 4,003 + 3,914)
÷ (8,619 + 8,702 + 8,829 + 8,612)
= 44.35%
2 Click competitor name to see calculations.
The financial data over the observed quarters indicates several notable trends in sales, gross profit, and profit margins.
- Net Sales
- Net sales demonstrated moderate fluctuations but followed a generally stable trajectory over the period. Starting from around 8.3 billion USD in early 2018, sales peaked near 8.9 billion in the first half of 2021. There was a visible dip in mid-2020, likely attributable to external market challenges evident globally during that period. Following this decline, a rebound occurred, though sales remained slightly below the previous peak levels by late 2022.
- Gross Profit
- Gross profit figures reflect variability closely tied to changes in net sales. After an initial range around the 4.0 billion USD mark in 2018, gross profit dipped markedly in early 2019 and again in the mid-2020 timeline, which paralleled the sales downturn. Post-2020, gross profit exhibited a recovery with levels mostly between 4.1 and 4.3 billion USD until a slight decline toward the end of 2021 and into 2022. The fluctuations suggest sensitivity to both sales volume and perhaps product cost dynamics.
- Gross Profit Margin
- The gross profit margin showed a consistent downward trend over the examined period. Starting near 49% in early 2018, the margin declined gradually to approximately 44% by late 2022. This indicates either rising costs of goods sold or increasing pricing pressure reducing relative profitability. The margin's decrease was steady without significant short-term recovery, suggesting a persistent pressure on cost efficiency or pricing power.
In summary, the data reflects stable sales volumes with certain disruption periods, fluctuating gross profit consistent with sales movements, and a gradual erosion of gross profit margins over time. This pattern could indicate challenges in managing cost structures or competitive pressures impacting pricing strategies.
Operating Profit Margin
3M Co., operating profit margin calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Operating income | 4,156) | 110) | 1,641) | 1,616) | 1,788) | 1,971) | 1,994) | 1,849) | 1,909) | 1,740) | 1,663) | 1,325) | 2,011) | 1,702) | 1,136) | 1,783) | 2,016) | 2,401) | 1,007) | ||||||
| Net sales | 8,619) | 8,702) | 8,829) | 8,612) | 8,942) | 8,950) | 8,851) | 8,583) | 8,350) | 7,176) | 8,075) | 8,111) | 7,991) | 8,171) | 7,863) | 7,945) | 8,152) | 8,390) | 8,278) | ||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Operating profit margin1 | 21.64% | 14.69% | 19.86% | 20.84% | 21.52% | 22.23% | 22.73% | 22.25% | 20.93% | 21.49% | 20.72% | 19.21% | 20.74% | 20.66% | 22.68% | 22.00% | 22.08% | 22.14% | 21.87% | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Operating Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | -11.99% | -6.98% | -6.53% | -4.66% | -10.80% | -12.18% | -20.36% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Caterpillar Inc. | 14.56% | 13.81% | 13.87% | 14.27% | 14.56% | 13.82% | 12.32% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eaton Corp. plc | 13.90% | 16.33% | 15.97% | 15.69% | 15.50% | 12.54% | 10.81% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| GE Aerospace | 7.05% | 8.12% | 7.31% | 8.58% | 7.86% | 6.82% | 4.72% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Honeywell International Inc. | 17.55% | 17.31% | 17.37% | 18.03% | 18.36% | 17.95% | 16.90% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lockheed Martin Corp. | 13.15% | 13.47% | 13.50% | 13.61% | 13.50% | 13.19% | 13.19% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| RTX Corp. | 7.93% | 7.81% | 7.75% | 7.70% | 5.93% | 4.61% | -3.59% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Operating profit margin = 100
× (Operating incomeQ3 2022
+ Operating incomeQ2 2022
+ Operating incomeQ1 2022
+ Operating incomeQ4 2021)
÷ (Net salesQ3 2022
+ Net salesQ2 2022
+ Net salesQ1 2022
+ Net salesQ4 2021)
= 100 × (4,156 + 110 + 1,641 + 1,616)
÷ (8,619 + 8,702 + 8,829 + 8,612)
= 21.64%
2 Click competitor name to see calculations.
- Operating Income Trends
- Operating income shows considerable fluctuations across the observed periods. It reached a peak in the second quarter of 2018 at 2401 million US dollars, followed by a decline towards the end of that year. In 2019, the income exhibited variability but remained generally lower than the 2018 peak, peaking again in the third quarter at 2011 million. In 2020, operating income was relatively stable with a slight increase towards the fourth quarter. The year 2021 saw a gradual decline from nearly 2000 million in the first quarter to around 1600 million by the end of the year. The first three quarters of 2022 indicate continued volatility with a sharp dip to 110 million in the second quarter followed by a significant rise to 4156 million in the third quarter.
- Net Sales Performance
- Net sales remained relatively stable across the observed quarters, generally maintaining a range between approximately 7800 million and 8900 million US dollars. Some declines were noted in the middle of 2020, likely reflecting external challenges, followed by a rebound in 2021 where sales peaked at 8950 million. The first three quarters of 2022 showed minor fluctuations but no clear sustained upward or downward trend.
- Operating Profit Margin Analysis
- The operating profit margin generally hovers around the low twenties percentage range. Peaks were observed in the first and fourth quarters of 2018 and the first quarter of 2021, all around 22 to 23%. A notable decline occurred in the second quarter of 2022, where the margin dropped sharply to 14.69%, before recovering above 21% in the third quarter of 2022. Over the overall period, the margin demonstrates moderate variability but remains mostly stable with occasional fluctuations likely linked to shifts in operating income.
- Summary of Insights
- While net sales have remained relatively steady, operating income and profit margins exhibited more pronounced volatility, suggesting fluctuating cost management or other operating factors influencing profitability independent of sales volume. The extreme dip and subsequent surge in operating income in 2022 indicate potential one-time events or adjustments affecting results. Overall, the profit margins have been resilient, maintaining a generally consistent level despite the operating income variability.
Net Profit Margin
3M Co., net profit margin calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Net income attributable to 3M | 3,859) | 78) | 1,299) | 1,339) | 1,434) | 1,524) | 1,624) | 1,389) | 1,413) | 1,290) | 1,292) | 969) | 1,583) | 1,127) | 891) | 1,347) | 1,543) | 1,857) | 602) | ||||||
| Net sales | 8,619) | 8,702) | 8,829) | 8,612) | 8,942) | 8,950) | 8,851) | 8,583) | 8,350) | 7,176) | 8,075) | 8,111) | 7,991) | 8,171) | 7,863) | 7,945) | 8,152) | 8,390) | 8,278) | ||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Net profit margin1 | 18.91% | 11.83% | 15.84% | 16.75% | 16.90% | 17.13% | 17.34% | 16.73% | 15.65% | 16.37% | 15.37% | 14.22% | 15.48% | 15.27% | 17.43% | 16.33% | 13.79% | 13.44% | 12.83% | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Net Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | -13.75% | -8.69% | -8.00% | -6.75% | -13.50% | -14.30% | -20.87% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Caterpillar Inc. | 13.70% | 13.19% | 13.02% | 13.47% | 11.28% | 10.17% | 8.53% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eaton Corp. plc | 11.36% | 11.70% | 11.21% | 10.92% | 10.60% | 9.86% | 8.05% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| GE Aerospace | -8.10% | -6.18% | -6.70% | -9.17% | -0.06% | -3.39% | -4.68% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Honeywell International Inc. | 15.38% | 14.74% | 15.30% | 16.11% | 15.80% | 14.65% | 14.17% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lockheed Martin Corp. | 9.07% | 7.33% | 9.45% | 9.42% | 9.13% | 10.69% | 10.53% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| RTX Corp. | 6.76% | 6.84% | 6.47% | 6.00% | 5.20% | 3.51% | -4.44% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Net profit margin = 100
× (Net income attributable to 3MQ3 2022
+ Net income attributable to 3MQ2 2022
+ Net income attributable to 3MQ1 2022
+ Net income attributable to 3MQ4 2021)
÷ (Net salesQ3 2022
+ Net salesQ2 2022
+ Net salesQ1 2022
+ Net salesQ4 2021)
= 100 × (3,859 + 78 + 1,299 + 1,339)
÷ (8,619 + 8,702 + 8,829 + 8,612)
= 18.91%
2 Click competitor name to see calculations.
The quarterly financial data reflects variations and trends in net income, net sales, and net profit margin over multiple periods. The analysis focuses on the observed patterns and changes in these key financial metrics.
- Net Income Attributable to 3M
- The net income demonstrates considerable fluctuations from 2018 through late 2022. Initially, there is a rise from a low of 602 million US dollars in the first quarter of 2018 to peaks surpassing 1,500 million US dollars throughout 2018 and 2019. However, starting in early 2022, a pronounced decline is evident with net income dropping sharply to a low of 78 million US dollars in the first quarter, before recovering significantly to reach 3,859 million US dollars by the third quarter of 2022. This indicates episodic volatility possibly influenced by market or operational factors during these periods.
- Net Sales
- Net sales remain relatively stable with modest variability across quarters. From around 8,200 to 8,900 million US dollars in most quarters across 2018 to mid-2021, the figures show consistency with minor seasonal or quarterly deviations. Notably, net sales dipped to approximately 7,176 million US dollars in the second quarter of 2020, which may reflect external challenges during that period. Subsequent quarters show recovery, with sales generally hovering close to or above 8,500 million US dollars before a slight decline trend towards late 2022, where values settled between 8,600 and 8,700 million US dollars.
- Net Profit Margin
- The net profit margin exhibits an overall upward trend from early 2018 through 2021, starting near 12.8%, peaking around 17.4% in early 2019, and maintaining levels between 16 and 17% for much of 2021. There is, however, a notable dip in the margin during 2022, dropping to approximately 11.8% in the second quarter before rebounding to nearly 19% by the third quarter of 2022. This pattern suggests efficiency or profitability pressures in early 2022 with subsequent improvement.
In summary, the data portrays a company experiencing stable sales with episodic shocks affecting profitability and net income, especially prominent in 2020 and early 2022. The recovery in net income and profit margins by the latter part of 2022 indicates a return to stronger financial performance after a period of pronounced volatility.
Return on Equity (ROE)
3M Co., ROE calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Net income attributable to 3M | 3,859) | 78) | 1,299) | 1,339) | 1,434) | 1,524) | 1,624) | 1,389) | 1,413) | 1,290) | 1,292) | 969) | 1,583) | 1,127) | 891) | 1,347) | 1,543) | 1,857) | 602) | ||||||
| Total 3M Company shareholders’ equity | 14,080) | 13,742) | 14,930) | 15,046) | 14,460) | 14,448) | 13,760) | 12,867) | 11,880) | 10,857) | 10,147) | 10,063) | 10,702) | 10,083) | 9,703) | 9,796) | 10,248) | 10,365) | 10,977) | ||||||
| Profitability Ratio | |||||||||||||||||||||||||
| ROE1 | 46.70% | 30.20% | 37.48% | 39.35% | 41.29% | 41.18% | 41.54% | 41.84% | 41.78% | 47.29% | 48.99% | 45.41% | 46.23% | 48.68% | 58.11% | 54.60% | 44.15% | 42.56% | 37.69% | ||||||
| Benchmarks | |||||||||||||||||||||||||
| ROE, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Caterpillar Inc. | 47.28% | 42.96% | 38.07% | 39.37% | 30.90% | 26.09% | 20.73% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eaton Corp. plc | 14.26% | 14.12% | 13.35% | 13.06% | 12.95% | 12.23% | 9.54% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| GE Aerospace | -18.56% | -12.75% | -12.20% | -16.17% | -0.11% | -7.29% | -9.82% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Honeywell International Inc. | 30.36% | 28.96% | 28.58% | 29.85% | 30.67% | 27.73% | 25.71% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lockheed Martin Corp. | 49.05% | 41.16% | 62.10% | 57.62% | 62.90% | 109.51% | 110.16% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| RTX Corp. | 6.36% | 6.34% | 5.79% | 5.29% | 4.65% | 3.07% | -3.74% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
ROE = 100
× (Net income attributable to 3MQ3 2022
+ Net income attributable to 3MQ2 2022
+ Net income attributable to 3MQ1 2022
+ Net income attributable to 3MQ4 2021)
÷ Total 3M Company shareholders’ equity
= 100 × (3,859 + 78 + 1,299 + 1,339)
÷ 14,080 = 46.70%
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several noteworthy trends in profitability and equity for the company over the reviewed periods.
- Net Income Attributable to the Company (US$ in millions)
- The net income exhibits significant fluctuations across quarters. Early periods demonstrate a peak in June 2018 (1,857 million USD) followed by a declining trend until March 2019 (891 million USD). Subsequently, earnings rebound, peaking again in September 2019 (1,583 million USD), before undergoing variability with relatively stable figures around 1,300 to 1,600 million USD through 2020 and 2021. Notably, a sharp decline occurs in June 2022 to 78 million USD, followed by a remarkable surge to 3,859 million USD in September 2022, indicating a highly volatile income pattern during recent quarters.
- Total Shareholders’ Equity (US$ in millions)
- The company's shareholders’ equity demonstrates a general upward trend over the observed timeframe. Starting at 10,977 million USD in March 2018, equity experiences minor fluctuations but increases steadily through to December 2021, reaching a peak of 15,046 million USD. In 2022, a slight decline in equity is observed during the first two quarters, ending at 14,080 million USD by September 2022, which may reflect capital changes or distribution effects within the period.
- Return on Equity (ROE, %)
- Return on Equity displays strong performance overall, with notably high levels especially during the initial quarters from 2018 to 2019, where ROE peaks at 58.11% in March 2019. Afterwards, there is a gradual decline in ROE through 2021, dropping into the high 30%–40% range. A marked decrease occurs in mid-2022, with ROE falling to 30.2% in June 2022, before recovering sharply to 46.7% by September 2022. This fluctuation parallels the volatility seen in net income, suggesting sensitivity of profitability metrics to earnings variability.
In summary, the company's financial results highlight periods of income volatility against a backdrop of generally increasing shareholders’ equity. While profitability ratios remain relatively strong, recent quarters reveal significant fluctuations in earnings and associated returns, warranting further investigation into the underlying operational or market factors driving these changes.
Return on Assets (ROA)
3M Co., ROA calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Net income attributable to 3M | 3,859) | 78) | 1,299) | 1,339) | 1,434) | 1,524) | 1,624) | 1,389) | 1,413) | 1,290) | 1,292) | 969) | 1,583) | 1,127) | 891) | 1,347) | 1,543) | 1,857) | 602) | ||||||
| Total assets | 46,176) | 45,634) | 45,855) | 47,072) | 48,278) | 48,307) | 47,180) | 47,344) | 45,390) | 45,079) | 46,212) | 44,659) | 42,550) | 38,969) | 39,140) | 36,500) | 37,275) | 36,778) | 38,575) | ||||||
| Profitability Ratio | |||||||||||||||||||||||||
| ROA1 | 14.24% | 9.09% | 12.20% | 12.58% | 12.37% | 12.32% | 12.12% | 11.37% | 10.94% | 11.39% | 10.76% | 10.23% | 11.63% | 12.59% | 14.40% | 14.65% | 12.14% | 11.99% | 10.72% | ||||||
| Benchmarks | |||||||||||||||||||||||||
| ROA, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | -6.14% | -3.90% | -3.60% | -3.03% | -5.77% | -5.92% | -7.85% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Caterpillar Inc. | 9.11% | 8.33% | 7.90% | 7.84% | 6.37% | 5.37% | 4.26% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eaton Corp. plc | 6.67% | 6.58% | 6.30% | 6.30% | 6.06% | 5.12% | 4.20% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| GE Aerospace | -3.23% | -2.38% | -2.48% | -3.28% | -0.02% | -1.03% | -1.34% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Honeywell International Inc. | 8.92% | 8.16% | 8.29% | 8.60% | 8.53% | 7.78% | 7.28% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lockheed Martin Corp. | 11.28% | 9.09% | 12.06% | 12.41% | 11.69% | 13.71% | 13.52% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| RTX Corp. | 2.82% | 2.81% | 2.63% | 2.39% | 2.09% | 1.37% | -1.67% | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
ROA = 100
× (Net income attributable to 3MQ3 2022
+ Net income attributable to 3MQ2 2022
+ Net income attributable to 3MQ1 2022
+ Net income attributable to 3MQ4 2021)
÷ Total assets
= 100 × (3,859 + 78 + 1,299 + 1,339)
÷ 46,176 = 14.24%
2 Click competitor name to see calculations.
The financial performance over the observed periods exhibits both variability and underlying trends in key metrics such as net income, total assets, and return on assets (ROA).
- Net Income
- Net income showed considerable fluctuations across quarters. Initially, there was an increase from 602 million US dollars in the first quarter of 2018 to a peak of 1857 million in the second quarter of that year. Subsequently, net income experienced oscillations without a clear upward or downward trajectory until mid-2021, where values ranged roughly between 1300 and 1600 million US dollars per quarter. Noteworthy is the sharp drop to 78 million in the first quarter of 2022, followed by a remarkable recovery to 3859 million in the third quarter of 2022, the highest in the observed periods. This suggests significant episodic impacts affecting profitability in early 2022 with a strong rebound shortly after.
- Total Assets
- Total assets showed a general upward trend over the entire period, increasing from approximately 38.6 billion US dollars in early 2018 to around 46.2 billion by late 2022. The asset base experienced modest declines towards 2018 year-end and mid-2020 but rebounded in subsequent quarters. The increases in total assets, albeit moderate, indicate sustained asset accumulation or valuation growth over time.
- Return on Assets (ROA)
- The ROA fluctuated across the quarters, starting at 10.72% in early 2018 and reaching values as high as 14.65% by the end of 2018. This metric displayed some volatility but generally remained within a band of approximately 10% to 14%, signifying relatively stable efficiency in utilizing assets for generating profits. The lowest ROA was at 9.09% in mid-2022, coinciding with the period of minimal net income, while the highest was 14.65% in late 2018. The substantial increase to 14.24% in the last recorded period corresponds with the pronounced net income recovery, reinforcing the correlation between profitable performance and asset utilization.
Overall, the data indicates that while total assets have gradually expanded, net income and ROA have experienced more pronounced quarter-to-quarter volatility. The sharp fluctuations in profitability and corresponding ROA in early to mid-2022 warrant further investigation to understand underlying causes, which could include extraordinary items or market impacts. Despite this volatility, the company appears to maintain a generally efficient use of its asset base to generate profit over the longer term.