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Return on invested capital (ROIC)
Operating income after a simple tax adjustment, divided by equity plus long-term debt minus cash, with the figure for each company.
The short answer
Return on invested capital is a profit figure divided by the capital tied up in the business. This page uses operating income after a simple tax adjustment, divided by shareholders' equity plus long-term debt minus cash. Across the 43 companies here, the median is 18.2%. The measure is not in the financial statements, so anyone who quotes it should say how it was built.
The formulas used here
Invested capital = shareholders' equity + long-term debt − cash
NOPAT = operating income × (1 − tax rate)
ROIC = NOPAT ÷ invested capital
Equity and cash come from the balance sheet, long-term debt from the same statement, and operating income from the income statement. NOPAT stands for net operating profit after tax: operating income with a tax charge applied as if that were the only profit. Return on equity uses net income and equity only; return on assets uses total assets. ROIC sits between them by counting borrowed capital as well as equity, and by starting from operating income rather than the bottom line.
Definitions differ
- Debt. Some versions add the current portion of long-term debt, commercial paper and lease liabilities. This table uses long-term debt only, the same simplified figure as on the net debt page.
- Cash. Some versions also subtract short-term investments and marketable securities, which can be large.
- Tax rate. Some people use the statutory 21% rate for every company. This table uses the effective rate from the 10-K when it falls between 0% and 40%.
- Average or year-end capital. Averaging the start and end of the year smooths big changes; the table uses year-end figures so every company is treated the same.
Because buybacks reduce equity, a company that has retired a lot of shares can show a very high ROIC even if operating income is not unusually large, the same distortion that shows up in return on equity. Comparisons are most useful within an industry and against a company's own past.
An example: Apple
Apple's latest 10-K reports operating income of $158.1B, shareholders' equity of $112.1B, long-term debt of $68.2B and cash of $36.3B. Invested capital on this definition is $144.0B, and ROIC is 91.1%.
Source: Apple 10-K for fiscal 2026, filed Nov 3, 2026
Every company
The highest ROIC in the table is Sandisk's, at 99.2%.
Operating income, shareholders' equity, long-term debt and cash and cash equivalents from each latest 10-K. Invested capital is equity plus long-term debt minus cash. ROIC is operating income after a tax adjustment, divided by invested capital, sorted by ROIC. The tax adjustment uses each company's effective tax rate (income tax expense divided by pretax income) when that rate is between 0% and 40%; otherwise it uses the 21% U.S. federal statutory rate. Commercial paper, the current portion of long-term debt when it is reported separately, leases and short-term investments are left out, so this is a simplified measure. Banks are left out. Companies with no operating profit or with invested capital of zero or less are also left out.
Common questions
How do you calculate return on invested capital?
One common version divides operating income after a tax adjustment by shareholders' equity plus debt minus cash. Other versions use different debt, cash and tax-rate definitions, so the figure is only as clear as the definition behind it.
What is NOPAT?
Net operating profit after tax: operating income with a tax charge applied. It tries to show what the operations earned after tax, before interest.
How is ROIC different from ROE?
ROE divides net income by shareholders' equity. ROIC counts borrowed capital as well, and usually starts from operating income rather than net income.
Why can ROIC be very high?
Often because invested capital is small after years of buybacks, not only because operating income is large. Negative or tiny invested capital makes the ratio meaningless, and those companies are left out of the table.
Is there an official ROIC number in the 10-K?
No. Companies sometimes show their own version as a non-GAAP measure. When they do, they have to show how it is built from the financial statements.
See it side by side
The same figures for two companies at once, each linked to its 10-K:
Disclosures
- Editor holdings
- The editor holds shares of Tesla (TSLA) and SpaceX in a long-term retirement account. The editor holds no position in any other company named on this page. As of Nov 11, 2026.
- Compensation
- Nobody paid for this page. No affiliate links on this page.
- Sources
- Each company's own SEC filings, linked next to each number.
- Last updated
- Nov 10, 2026
General education, the same for every reader. Not a recommendation to buy, sell or hold any security, and it doesn't consider your situation.
More in Learn and Tools · Methodology & Disclosures explains where every number comes from.