Analysis Of Nvidia's Financial Performance Based on Dupont Analysis Method

Zhengyu Ma

doi:10.54097/cv16ce94

Authors

Zhengyu Ma

DOI:

https://doi.org/10.54097/cv16ce94

Keywords:

DuPont analysis; NVIDIA; financial performance; Al industry; supply chain management.

Abstract

This study employs the DuPont analysis method to evaluate the financial performance of NVIDIA Corporation from 2020 to 2025, focusing on its Return on Equity (ROE) and its key drivers: Net Profit Margin (NPM), Asset Turnover (TAT), and Equity Multiplier (EM). Amid the rapid growth of the Al, data center, and gaming industries, NVIDIA has emerged as a global leader in GPU and Al computing, with its revenue surging from $10.918 billion in 2020 to $130.5 billion in 2025. The analysis reveals that ROE increased from 25.82% to 119.18%, driven primarily by significant improvements in NPM (25.61% to 55.85%) and TAT (0.71 to 1.47), despite a conservative EM (1.42 to 1.45). The study highlights NVIDIA's strong profitability and operational efficiency in the Al boom, but also identifies risks such as supply chain disruptions, competitive pressures, and market volatility. Recommendations include optimizing supply chains, accelerating technological innovation, and diversifying market strategies to sustain long-term growth. Supported by comparative insights from studies on banking and insurance, this research provides valuable implications for investors and industry stakeholders.

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