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Novartis AG Operating Margin %

: 24.19% (As of Sep. 2021)
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Operating Margin % is calculated as Operating Income divided by its Revenue. Novartis AG's Operating Income for the three months ended in Sep. 2021 was $3,233 Mil. Novartis AG's Revenue for the three months ended in Sep. 2021 was $13,367 Mil. Therefore, Novartis AG's Operating Margin % for the quarter that ended in Sep. 2021 was 24.19%.

Good Sign:

Novartis AG operating margin is expanding. Margin expansion is usually a good sign.

The historical rank and industry rank for Novartis AG's Operating Margin % or its related term are showing as below:

NYSE:NVS' s Operating Margin % Range Over the Past 10 Years
Min: 16.72   Med: 19.36   Max: 22.47
Current: 22.47

16.72
22.47

NYSE:NVS's Operating Margin % is ranked higher than
87% of the 1046 Companies
in the Drug Manufacturers industry.

( Industry Median: 5.66 vs. NYSE:NVS: 22.47 )

Novartis AG's 5-Year Average Operating Margin % Growth Rate was 2.60% per year.

Novartis AG's Operating Income for the three months ended in Sep. 2021 was $3,233 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Sep. 2021 was $11,771 Mil.


Novartis AG Operating Margin % Historical Data

The historical data trend for Novartis AG's Operating Margin % 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.

* Premium members only.

Novartis AG Annual Data
Trend Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20
Operating Margin %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 16.72 20.05 18.23 18.67 20.35

Novartis AG Quarterly Data
Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21
Operating Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 19.24 20.29 19.02 26.17 24.19

Competitive Comparison

For the Drug Manufacturers - General subindustry, Novartis AG's Operating Margin %, along with its competitors' market caps and Operating Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Novartis AG Operating Margin % Distribution

For the Drug Manufacturers industry and Healthcare sector, Novartis AG's Operating Margin % distribution charts can be found below:

* The bar in red indicates where Novartis AG's Operating Margin % falls into.



Novartis AG Operating Margin % Calculation

Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.

Novartis AG's Operating Margin % for the fiscal year that ended in Dec. 2020 is calculated as

Operating Margin %=Operating Income (A: Dec. 2020 ) / Revenue (A: Dec. 2020 )
=10152 / 49898
=20.35 %

Novartis AG's Operating Margin % for the quarter that ended in Sep. 2021 is calculated as

Operating Margin %=Operating Income (Q: Sep. 2021 ) / Revenue (Q: Sep. 2021 )
=3233 / 13367
=24.19 %

* 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.


Novartis AG  (NYSE:NVS) Operating Margin % Explanation

Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.


Be Aware

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 (Diluted) 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.


Novartis AG Operating Margin % Related Terms

Thank you for viewing the detailed overview of Novartis AG's Operating Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.


Novartis AG Business Description

Novartis AG logo
Industry
Healthcare » Drug Manufacturers NAICS : 325412 SIC : 0
Address
Lichtstrasse 35, Basel, CHE, 4056
Novartis AG develops and manufactures healthcare products through two segments: Innovative Medicines and Sandoz. It generates the vast majority of its revenue from Innovative Medicines segment consisting global business franchises in oncology, ophthalmology, neuroscience, immunology, respiratory, cardio-metabolic, and established medicines. The firm sells its products globally, with the United States representing close to one third of total revenue.

Novartis AG Headlines

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