Common-Size Income Statement
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- Statement of Comprehensive Income
- Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Geographic Areas
- Common Stock Valuation Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Enterprise Value to FCFF (EV/FCFF)
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Total Asset Turnover since 2005
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Eaton Corp. plc, common-size consolidated income statement
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The common-size income statement reveals several noteworthy trends over the five-year period. A consistent improvement in profitability is evident, driven by changes in cost structure and operational efficiency. Gross profit as a percentage of net sales increased steadily from 32.28% in 2021 to 38.20% in 2024, before slightly decreasing to 37.59% in 2025. Operating income also demonstrated a positive trajectory, rising from 15.69% to 18.98% over the same period. Net income attributable to Eaton ordinary shareholders followed a similar pattern, increasing from 10.92% to 14.89%.
- Cost of Products Sold
- The proportion of net sales consumed by the cost of products sold generally decreased, moving from -67.72% in 2021 to -61.80% in 2024, then increasing slightly to -62.41% in 2025. This suggests improved cost management or a shift towards higher-margin products.
- Operating Expenses
- Selling and administrative expense remained relatively stable as a percentage of net sales, fluctuating between -15.55% and -16.59% throughout the period, with a slight decrease to -15.71% in 2025. Research and development expense also exhibited relative stability, decreasing from -3.14% to -2.90% over the period, indicating consistent investment in innovation.
- Non-Operating Items
- Gain on sale of businesses contributed positively to operating income in 2021 and 2022, at 3.14% and 0.12% of net sales respectively, but disappeared in subsequent years. Interest expense, net, generally decreased as a percentage of net sales from -0.73% to -0.52% before increasing to -0.88% in 2025. Other income (expense), net, showed volatility, moving from -0.20% to 0.40% and then to -0.13% in 2025.
- Tax Rate
- The effective tax rate, as indicated by income tax expense as a percentage of net sales, decreased significantly from -3.82% in 2021 to -2.14% in 2022, then increased to -3.09% in 2024 and remained at -3.07% in 2025. This fluctuation could be attributed to changes in tax laws or the geographic distribution of income.
- Net Income
- Net income attributable to Eaton ordinary shareholders demonstrated consistent growth, increasing from 10.92% of net sales in 2021 to 15.25% in 2024, before a slight decrease to 14.89% in 2025. This indicates improved overall profitability and efficiency in generating earnings from revenue.
Overall, the financial performance appears to be strengthening, with improvements in gross margin, operating income, and net income. While cost of products sold increased slightly in the most recent year, the overall trend suggests effective cost management and operational improvements. Fluctuations in non-operating items and the tax rate warrant further investigation, but do not appear to significantly detract from the positive overall trend.