Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Return on Sales
Return on Investment
Amphenol Corp., profitability ratios
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
Analysis of profitability ratios from 2019 to 2023 reveals a general trend of resilience and expansion in margins, contrasted by more volatile returns on invested capital. While profit margins improved steadily following a brief contraction in 2020, efficiency ratios peaked in 2022 before moderating in 2023.
- Gross Profit Margin
- A slight decline was observed in 2020, where the margin dropped to 30.98%. Since that period, a consistent upward trajectory has been maintained, reaching a five-year peak of 32.53% by December 31, 2023. This suggests a steady improvement in cost of goods sold management or an increase in pricing power.
- Operating Profit Margin
- The operating margin remained relatively stable over the five-year period. After a dip to 19.05% in 2020, the margin expanded to peak at 20.48% in 2022. The final value in 2023 shows a marginal contraction to 20.39%, indicating that operating expenses have been scaled effectively in line with revenue growth.
- Net Profit Margin
- The net profit margin demonstrates the most consistent growth pattern among the margin ratios. Following a low of 13.99% in 2020, the margin increased annually, reaching 15.36% in 2023. This steady climb indicates a sustained increase in overall bottom-line profitability.
- Return on Equity (ROE)
- ROE exhibited significant volatility, decreasing from 25.50% in 2019 to 22.35% in 2020. A strong recovery occurred through 2022, where it peaked at 27.12%, before declining to 23.10% in 2023. The decline in the final year, despite rising net profit margins, may suggest an increase in the equity base.
- Return on Assets (ROA)
- ROA followed a trajectory closely mirroring that of ROE. After falling to 9.76% in 2020, it rose to a peak of 12.41% in 2022 and subsequently moderated to 11.67% in 2023. The correlation between ROA and ROE patterns suggests that the fluctuations in returns were driven by broad asset utilization and capital structure shifts rather than isolated equity changes.
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Gross Profit Margin
Amphenol Corp., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Gross profit | 4,084,100) | 4,028,200) | 3,401,800) | 2,664,100) | 2,616,000) | |
| Net sales | 12,554,700) | 12,623,000) | 10,876,300) | 8,598,900) | 8,225,400) | |
| Profitability Ratio | ||||||
| Gross profit margin1 | 32.53% | 31.91% | 31.28% | 30.98% | 31.80% | |
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Apple Inc. | 44.13% | 43.31% | 41.78% | 38.23% | — | |
| Arista Networks Inc. | 61.95% | 61.07% | 63.80% | — | — | |
| Cisco Systems Inc. | 62.73% | 62.55% | 64.02% | — | — | |
| Dell Technologies Inc. | 22.18% | 21.63% | 31.22% | — | — | |
| Lumentum Holdings Inc. | 32.20% | 46.05% | 44.93% | — | — | |
| Super Micro Computer Inc. | 18.01% | 15.40% | 15.03% | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Gross profit margin = 100 × Gross profit ÷ Net sales
= 100 × 4,084,100 ÷ 12,554,700 = 32.53%
2 Click competitor name to see calculations.
The financial performance from 2019 to 2023 is characterized by substantial growth in absolute revenue and profit figures, accompanied by a resilient and improving gross profit margin.
- Net Sales Trends
- A consistent upward trajectory in revenue is observed between 2019 and 2022, with net sales increasing from US$ 8.23 billion to a peak of US$ 12.62 billion. A marginal contraction occurred in 2023, with sales settling at US$ 12.55 billion.
- Gross Profit Evolution
- Gross profit demonstrated steady growth throughout the period, rising from US$ 2.62 billion in 2019 to US$ 4.08 billion in 2023. Notably, the increase in gross profit continued into 2023 despite the slight decline in total net sales.
- Gross Profit Margin Analysis
- The gross profit margin remained stable, fluctuating within a narrow range of approximately 1.5 percentage points. After a slight dip to 30.98% in 2020, the margin entered a period of sustained expansion, reaching a five-year peak of 32.53% by the end of 2023. This trend suggests an improvement in production efficiency or a favorable shift in product mix, as the margin expanded even while top-line revenue experienced a minor decrease in the final year of the period.
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Operating Profit Margin
Amphenol Corp., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Operating income | 2,559,600) | 2,585,800) | 2,105,100) | 1,638,400) | 1,619,200) | |
| Net sales | 12,554,700) | 12,623,000) | 10,876,300) | 8,598,900) | 8,225,400) | |
| Profitability Ratio | ||||||
| Operating profit margin1 | 20.39% | 20.48% | 19.35% | 19.05% | 19.69% | |
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Apple Inc. | 29.82% | 30.29% | 29.78% | 24.15% | — | |
| Arista Networks Inc. | 38.52% | 34.86% | 31.37% | — | — | |
| Cisco Systems Inc. | 26.37% | 27.09% | 25.76% | — | — | |
| Dell Technologies Inc. | 5.64% | 4.60% | 5.46% | — | — | |
| Lumentum Holdings Inc. | -6.55% | 17.71% | 30.24% | — | — | |
| Super Micro Computer Inc. | 10.68% | 6.45% | 3.48% | — | — | |
| Operating Profit Margin, Sector | ||||||
| Technology Hardware & Equipment | 24.76% | 25.11% | 24.80% | — | — | |
| Operating Profit Margin, Industry | ||||||
| Information Technology | 24.34% | 26.23% | 26.58% | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Operating profit margin = 100 × Operating income ÷ Net sales
= 100 × 2,559,600 ÷ 12,554,700 = 20.39%
2 Click competitor name to see calculations.
The financial performance between 2019 and 2023 is characterized by a consistent expansion in scale and a sustained level of operational efficiency. While a slight contraction occurred in the final year of the period, the overall trajectory demonstrates significant growth in both top-line revenue and operating results.
- Net Sales Growth
- A strong upward trend in net sales is evident, rising from 8,225,400 thousand US$ in 2019 to a peak of 12,623,000 thousand US$ in 2022. This represents a substantial increase in volume over four years, followed by a marginal decline to 12,554,700 thousand US$ in 2023, indicating a period of stabilization.
- Operating Income Performance
- Operating income mirrored the growth of net sales, increasing from 1,619,200 thousand US$ in 2019 to 2,585,800 thousand US$ in 2022. The result for 2023 showed a slight decrease to 2,559,600 thousand US$, maintaining the gains achieved during the primary growth phase.
- Operating Profit Margin Analysis
- The operating profit margin remained remarkably stable, fluctuating within a narrow range of approximately 1.43 percentage points. After a slight dip to 19.05% in 2020, the margin recovered and expanded to a peak of 20.48% in 2022. The 2023 margin of 20.39% confirms that profitability has stabilized at a higher level than that observed at the beginning of the five-year period, suggesting improved cost management or pricing power.
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Net Profit Margin
Amphenol Corp., net profit margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income attributable to Amphenol Corporation | 1,928,000) | 1,902,300) | 1,590,800) | 1,203,400) | 1,155,000) | |
| Net sales | 12,554,700) | 12,623,000) | 10,876,300) | 8,598,900) | 8,225,400) | |
| Profitability Ratio | ||||||
| Net profit margin1 | 15.36% | 15.07% | 14.63% | 13.99% | 14.04% | |
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Apple Inc. | 25.31% | 25.31% | 25.88% | 20.91% | — | |
| Arista Networks Inc. | 35.62% | 30.87% | 28.52% | — | — | |
| Cisco Systems Inc. | 22.13% | 22.91% | 21.26% | — | — | |
| Dell Technologies Inc. | 2.39% | 5.50% | 3.45% | — | — | |
| Lumentum Holdings Inc. | -7.45% | 11.61% | 22.80% | — | — | |
| Super Micro Computer Inc. | 8.98% | 5.49% | 3.14% | — | — | |
| Net Profit Margin, Sector | ||||||
| Technology Hardware & Equipment | 20.57% | 21.31% | 21.21% | — | — | |
| Net Profit Margin, Industry | ||||||
| Information Technology | 20.24% | 22.27% | 23.48% | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Net profit margin = 100 × Net income attributable to Amphenol Corporation ÷ Net sales
= 100 × 1,928,000 ÷ 12,554,700 = 15.36%
2 Click competitor name to see calculations.
An analysis of the financial performance from 2019 through 2023 reveals a consistent upward trajectory in absolute profitability and a steady expansion of operational efficiency. While revenue growth experienced a slight deceleration in the final year of the period, the ability to convert sales into net income improved progressively.
- Net Income and Revenue Growth
- Net income attributable to the corporation exhibited uninterrupted growth over the five-year period, rising from 1.155 billion US$ in 2019 to 1.928 billion US$ in 2023. Net sales followed a similar growth pattern for the majority of the period, increasing from 8.225 billion US$ in 2019 to a peak of 12.623 billion US$ in 2022. A marginal contraction in net sales occurred in 2023, decreasing to 12.555 billion US$, yet net income continued to increase, suggesting a decoupling of profit growth from pure volume expansion.
- Net Profit Margin Expansion
- The net profit margin demonstrated a positive trend, climbing from 14.04% in 2019 to 15.36% in 2023. Aside from a negligible dip to 13.99% in 2020, the margin expanded every subsequent year. The most notable efficiency gain occurred between 2022 and 2023; despite the slight decline in total net sales, the net profit margin reached its highest point in the period analyzed. This indicates improved cost management or a shift toward higher-margin product mixes.
- Profitability Correlation
- The data indicates a strengthening relationship between scale and profitability. The acceleration of net income growth between 2020 and 2022 coincided with a significant surge in net sales, while the 2023 results highlight a transition toward margin optimization. The steady increase in the net profit margin suggests that the organization has successfully scaled its operations while simultaneously reducing the relative impact of operating expenses on the bottom line.
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Return on Equity (ROE)
Amphenol Corp., ROE calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income attributable to Amphenol Corporation | 1,928,000) | 1,902,300) | 1,590,800) | 1,203,400) | 1,155,000) | |
| Stockholders’ equity attributable to Amphenol Corporation | 8,346,500) | 7,015,600) | 6,302,000) | 5,384,900) | 4,530,300) | |
| Profitability Ratio | ||||||
| ROE1 | 23.10% | 27.12% | 25.24% | 22.35% | 25.50% | |
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Apple Inc. | 156.08% | 196.96% | 150.07% | 87.87% | — | |
| Arista Networks Inc. | 28.91% | 27.68% | 21.13% | — | — | |
| Cisco Systems Inc. | 28.44% | 29.70% | 25.66% | — | — | |
| Dell Technologies Inc. | — | — | 131.10% | — | — | |
| Lumentum Holdings Inc. | -9.71% | 10.61% | 20.14% | — | — | |
| Super Micro Computer Inc. | 32.45% | 20.00% | 10.20% | — | — | |
| ROE, Sector | ||||||
| Technology Hardware & Equipment | 100.63% | 122.76% | 96.47% | — | — | |
| ROE, Industry | ||||||
| Information Technology | 31.26% | 38.03% | 41.64% | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
ROE = 100 × Net income attributable to Amphenol Corporation ÷ Stockholders’ equity attributable to Amphenol Corporation
= 100 × 1,928,000 ÷ 8,346,500 = 23.10%
2 Click competitor name to see calculations.
Analysis of the five-year financial performance indicates a consistent expansion in both net income and stockholders' equity, though the return on equity has experienced periodic fluctuations.
- Net Income Trajectory
- Net income attributable to the corporation demonstrated a steady upward trend, increasing from 1,155,000 thousand US$ in 2019 to 1,928,000 thousand US$ by the end of 2023. The most pronounced growth occurred between 2020 and 2022, signaling a period of strong profit acceleration.
- Stockholders' Equity Expansion
- The equity base grew substantially over the observed period, rising from 4,530,300 thousand US$ in 2019 to 8,346,500 thousand US$ in 2023. This represents a near doubling of the capital attributable to stockholders, reflecting significant accumulation of retained earnings or capital injections.
- Return on Equity (ROE) Volatility
- The return on equity exhibited a fluctuating pattern, starting at 25.50% in 2019 and ending at 23.10% in 2023. A decline to 22.35% was recorded in 2020, followed by a recovery that peaked at 27.12% in 2022. The subsequent reduction to 23.10% in 2023, despite the increase in net income, indicates that the growth in the equity base outpaced the growth in net income during the final year of the period.
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Return on Assets (ROA)
Amphenol Corp., ROA calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income attributable to Amphenol Corporation | 1,928,000) | 1,902,300) | 1,590,800) | 1,203,400) | 1,155,000) | |
| Total assets | 16,526,400) | 15,326,200) | 14,678,400) | 12,327,300) | 10,815,500) | |
| Profitability Ratio | ||||||
| ROA1 | 11.67% | 12.41% | 10.84% | 9.76% | 10.68% | |
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Apple Inc. | 27.51% | 28.29% | 26.97% | 17.73% | — | |
| Arista Networks Inc. | 20.98% | 19.96% | 14.66% | — | — | |
| Cisco Systems Inc. | 12.38% | 12.57% | 10.86% | — | — | |
| Dell Technologies Inc. | 2.73% | 6.00% | 2.63% | — | — | |
| Lumentum Holdings Inc. | -2.84% | 4.78% | 11.19% | — | — | |
| Super Micro Computer Inc. | 17.42% | 8.90% | 4.99% | — | — | |
| ROA, Sector | ||||||
| Technology Hardware & Equipment | 20.39% | 21.50% | 18.83% | — | — | |
| ROA, Industry | ||||||
| Information Technology | 12.34% | 14.33% | 14.52% | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
ROA = 100 × Net income attributable to Amphenol Corporation ÷ Total assets
= 100 × 1,928,000 ÷ 16,526,400 = 11.67%
2 Click competitor name to see calculations.
Between 2019 and 2023, a consistent upward trajectory in both net income and total assets is observed, though the efficiency of asset utilization, as measured by the return on assets (ROA), exhibited periodic fluctuations.
- Net Income Growth
- Net income attributable to Amphenol Corporation grew from 1,155,000 thousand US$ in 2019 to 1,928,000 thousand US$ by 2023. The most significant acceleration occurred between 2020 and 2022, where net income rose from 1,203,400 thousand US$ to 1,902,300 thousand US$, reflecting a substantial increase in bottom-line profitability during this interval.
- Asset Base Expansion
- Total assets experienced steady growth throughout the five-year period, increasing from 10,815,500 thousand US$ in 2019 to 16,526,400 thousand US$ in 2023. This consistent expansion indicates a continuous investment in the company's resource base to support operational scaling.
- Return on Assets (ROA) Dynamics
- The ROA trend reflects varying levels of asset efficiency. A slight contraction is noted in 2020, with the ratio dipping to 9.76% as asset growth outpaced net income gains. However, a recovery and subsequent peak occurred in 2022, reaching 12.41%, driven by net income growth that significantly exceeded the rate of asset expansion. By 2023, the ROA moderated to 11.67%, suggesting that while the company remains profitable, the marginal increase in net income was not sufficient to offset the continued growth in the asset base.
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