Electro Scientific Industries (Electro Scientific Industries) Operating Income : $94.8 Mil (TTM As of Dec. 2018)

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What is Electro Scientific Industries Operating Income?

Electro Scientific Industries's Operating Income for the three months ended in Dec. 2018 was $8.2 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2018 was $94.8 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Electro Scientific Industries's Operating Income for the three months ended in Dec. 2018 was $8.2 Mil. Electro Scientific Industries's Revenue for the three months ended in Dec. 2018 was $67.9 Mil. Therefore, Electro Scientific Industries's Operating Margin % for the quarter that ended in Dec. 2018 was 12.00%.

Electro Scientific Industries's 5-Year average Growth Rate for Operating Margin % was 0.00% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Electro Scientific Industries's annualized ROC % for the quarter that ended in Dec. 2018 was 18.44%. Electro Scientific Industries's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2018 was 30.25%.

Electro Scientific Industries Operating Income Historical Data

The historical data trend for Electro Scientific Industries's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Electro Scientific Industries Operating Income Chart

Electro Scientific Industries Annual Data

Trend

Mar09

Mar10

Mar11

Mar12

Mar13

Mar14

Mar15

Mar16

Mar17

Mar18

Operating Income

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-29.57

-29.79

-9.45

-22.95

79.80

Electro Scientific Industries Quarterly Data
	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16	Sep16	Dec16	Mar17	Jun17	Sep17	Dec17	Mar18	Jun18	Sep18	Dec18
Operating Income	Get a 7-Day Free Trial															33.95	34.56	33.01	19.08	8.15

Electro Scientific Industries Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Dec. 2018 adds up the quarterly data reported by the company within the most recent 12 months, which was $94.8 Mil.

Electro Scientific Industries (NAS:ESIO) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Electro Scientific Industries's annualized ROC % for the quarter that ended in Dec. 2018 is calculated as:

	ROC % (Q: Dec. 2018 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2018 )	+	Invested Capital (Q: Dec. 2018 ))	/ count )
=	32.612 * ( 1 - -8.17% )	/	( (185.349	+	197.266)	/ 2 )
=	35.2764004	/	191.3075
=	18.44 %

where

	Invested Capital		(Q: Sep. 2018 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	392.872	-	29.336	-	( 178.187	-	max(0, 53.64	-	304.348	+	178.187	))
=	185.349

	Invested Capital		(Q: Dec. 2018 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	408.152	-	35.676	-	( 175.21	-	max(0, 61.769	-	321.383	+	175.21	))
=	197.266

Note: The Operating Income data used here is four times the quarterly (Dec. 2018) data.

2. Joel Greenblatt's definition of Return on Capital:

Electro Scientific Industries's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2018 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Dec. 2018 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Sep. 2018		Q: Dec. 2018
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	32.612	/	( ( (24.711 + max(72.953, 0))	+	(33.087 + max(84.841, 0)) )	/	2 )
=	32.612	/	( ( 97.664	+	117.928 )	/	2 )
=	32.612	/	107.796
=	30.25 %

where Working Capital is:

	Working Capital		(Q: Sep. 2018 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(38.422	+	81.434	+	6.305)	-	(29.336	+	9.61	+	14.262)
=	72.953

	Working Capital		(Q: Dec. 2018 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(55.557	+	81.846	+	8.7699999999999)	-	(35.676	+	9.828	+	15.828)
=	84.841

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Dec. 2018) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Electro Scientific Industries's Operating Margin % for the quarter that ended in Dec. 2018 is calculated as:

Operating Margin %	=	Operating Income (Q: Dec. 2018 )	/	Revenue (Q: Dec. 2018 )
	=	8.153	/	67.942
	=	12.00 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Electro Scientific Industries Operating Income Related Terms

Thank you for viewing the detailed overview of Electro Scientific Industries's Operating Income provided by GuruFocus.com. Please click on the following links to see related term pages.

Electro Scientific Industries (Electro Scientific Industries) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Semiconductors » Electro Scientific Industries Inc (NAS:ESIO) » Definitions » Operating Income

Traded in Other Exchanges

N/A

Address

Website

http://www.esi.com

Electro Scientific Industries Inc is a manufacturer of electronic components. The company operates through two segments: Component Processing and Micromachining. The Component Processing segment includes interconnect products, semiconductor products, and component products. The interconnect, semiconductor and component products are sold to manufacturers of electronic components and are used to drill, cut, trim, ablate and test and mark features for the functionality of the component. The Micromachining segment includes products that are sold to manufacturers of end devices across various industries and are used to drill, cut or mark features on a range of materials, generally on the casing or external surface of the end device.

Executives

Raymond A Link	director	C/O FORMFACTOR, INC., 7005 SOUTHFRONT ROAD, LIVERMORE CA 94551
Michael D Burger	officer: PRESIDENT AND CEO	250 TECHNOLOGY PARK, LAKE MARY FL 32746
Allen L. Muhich	officer: CHIEF FINANCIAL OFFICER	250 TECHNOLOGY PARK, LAKE MARY FL 32746
Lynne J Camp	director	714 NW 914TH TERRACE, PORTLAND OR 97229
Paul R Oldham	officer: CFO, Sr. VP of Finance	1625 SHARP POINT DRIVE, FORT COLLINS CO 80525
John K Medica	director	C/O NATIONAL INSTRUMENTS CORPORATION, 11500 NORTH MOPAC EXPWY, BLDG C, AUSTIN TX 78759
Edward C Grady	director, officer: President & CEO
Richard J Faubert	director	14242 S CANYON DR, PHOENIX AZ 85048
Jon D Tompkins	director	17075 THORNMINT COURT, SAN DIEGO CA 92127
D3 Family Fund Lp	director, 10 percent owner	19605 NE 8TH STREET CAMAS WA 98607
Nierenberg Investment Management Co	director	19605 NE 8TH ST, CAMAS WA 98607
David Nierenberg	director, 10 percent owner	19605 NE 8TH STREET, CAMAS WA 98607
Nierenberg Investment Management Offshore Inc	10 percent owner	19605 NE 8TH STREET CAMAS WA 98607
D3 Family Canadian Fund, L.p.	10 percent owner	19605 NE 8TH STREET, CAMAS WA 98607
D3 Offshore Fund Lp	10 percent owner	19605 NE 8TH ST CAMAS WA 98607