Name: Operating Profit Margin

Definition: Operating profit margin focuses on profits from the company’s core business — before interest payments and taxes. It reflects how well the business manages operating costs relative to sales. Strong operating margins show efficient day-to-day operations. Shrinking margins may reveal rising overhead, pricing weakness, or declining efficiency.

Interpretation:
• In '2022', SMTC's operating profit margin was 19.6%, highlighting profit earned from core business operations. Industry average for Semiconductors in '2022' stood at -23.4%.
• In '2023', SMTC's operating profit margin was 11.4%, highlighting profit earned from core business operations. The decline from '2022' may indicate some operational or financial challenges. Industry average for Semiconductors in '2023' stood at -19.8%. Industry average increased by 3.6% compared to previous year.
• In '2024', SMTC's operating profit margin was -14.4%, highlighting profit earned from core business operations. The decline from '2023' may indicate some operational or financial challenges. Industry average for Semiconductors in '2024' stood at -50.6%. Industry average declined by 30.8% from previous year.
• In '2025', SMTC's operating profit margin was 6.9%, highlighting profit earned from core business operations. The increase since '2024' reflects strengthening financial performance. Industry average for Semiconductors in '2025' stood at 13.2%. Industry average increased by 63.7% compared to previous year.
Overall, SMTC's operating profit margin has been volatile but showed a downward trend over the past 4 years.

Formula: Operating Profit Margin = Operating Income / Revenue

Good Range: Often 10%-30% depending on business model.