Stock Analysis on Net

International Business Machines Corp. (NYSE:IBM)

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Analysis of Profitability Ratios

Microsoft Excel

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Profitability Ratios (Summary)

International Business Machines Corp., profitability ratios

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Return on Sales
Gross profit margin
Operating profit margin
Net profit margin
Return on Investment
Return on equity (ROE)
Return on assets (ROA)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. International Business Machines Corp. gross profit margin ratio improved from 2019 to 2020 and from 2020 to 2021.
Operating profit margin A profitability ratio calculated as operating income divided by revenue. International Business Machines Corp. operating profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level.
Net profit margin An indicator of profitability, calculated as net income divided by revenue. International Business Machines Corp. net profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity. International Business Machines Corp. ROE deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.
ROA A profitability ratio calculated as net income divided by total assets. International Business Machines Corp. ROA deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.

Gross Profit Margin

International Business Machines Corp., gross profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Gross profit
Revenue
Profitability Ratio
Gross profit margin1
Benchmarks
Gross Profit Margin, Competitors2
Accenture PLC
Adobe Inc.
Intuit Inc.
Microsoft Corp.
Oracle Corp.
Salesforce Inc.
ServiceNow Inc.

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenue
= 100 × ÷ =

2 Click competitor name to see calculations.

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. International Business Machines Corp. gross profit margin ratio improved from 2019 to 2020 and from 2020 to 2021.

Operating Profit Margin

International Business Machines Corp., operating profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Revenue
Profitability Ratio
Operating profit margin1
Benchmarks
Operating Profit Margin, Competitors2
Accenture PLC
Adobe Inc.
Intuit Inc.
Mastercard Inc.
Microsoft Corp.
Oracle Corp.
PayPal Holdings Inc.
Salesforce Inc.
ServiceNow Inc.
Visa Inc.
Operating Profit Margin, Sector
Software & Services
Operating Profit Margin, Industry
Information Technology

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Operating profit margin = 100 × Operating income ÷ Revenue
= 100 × ÷ =

2 Click competitor name to see calculations.

Profitability ratio Description The company
Operating profit margin A profitability ratio calculated as operating income divided by revenue. International Business Machines Corp. operating profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level.

Net Profit Margin

International Business Machines Corp., net profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Net income attributable to IBM
Revenue
Profitability Ratio
Net profit margin1
Benchmarks
Net Profit Margin, Competitors2
Accenture PLC
Adobe Inc.
Intuit Inc.
Mastercard Inc.
Microsoft Corp.
Oracle Corp.
PayPal Holdings Inc.
Salesforce Inc.
ServiceNow Inc.
Visa Inc.
Net Profit Margin, Sector
Software & Services
Net Profit Margin, Industry
Information Technology

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Net profit margin = 100 × Net income attributable to IBM ÷ Revenue
= 100 × ÷ =

2 Click competitor name to see calculations.

Profitability ratio Description The company
Net profit margin An indicator of profitability, calculated as net income divided by revenue. International Business Machines Corp. net profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level.

Return on Equity (ROE)

International Business Machines Corp., ROE calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Net income attributable to IBM
Total IBM stockholders’ equity
Profitability Ratio
ROE1
Benchmarks
ROE, Competitors2
Accenture PLC
Adobe Inc.
Intuit Inc.
Mastercard Inc.
Microsoft Corp.
Oracle Corp.
PayPal Holdings Inc.
Salesforce Inc.
ServiceNow Inc.
Visa Inc.
ROE, Sector
Software & Services
ROE, Industry
Information Technology

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
ROE = 100 × Net income attributable to IBM ÷ Total IBM stockholders’ equity
= 100 × ÷ =

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity. International Business Machines Corp. ROE deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.

Return on Assets (ROA)

International Business Machines Corp., ROA calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Net income attributable to IBM
Total assets
Profitability Ratio
ROA1
Benchmarks
ROA, Competitors2
Accenture PLC
Adobe Inc.
Intuit Inc.
Mastercard Inc.
Microsoft Corp.
Oracle Corp.
PayPal Holdings Inc.
Salesforce Inc.
ServiceNow Inc.
Visa Inc.
ROA, Sector
Software & Services
ROA, Industry
Information Technology

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
ROA = 100 × Net income attributable to IBM ÷ Total assets
= 100 × ÷ =

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROA A profitability ratio calculated as net income divided by total assets. International Business Machines Corp. ROA deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.