What is ROA by Industry?
Why Some Companies Make Money Better Than Others? A construction company makes 10 10-cent profit for every dollar it owns. A biotech company loses 42 cents.
This isn’t about good management versus bad management. It’s about how different types of businesses work. Some industries need massive factories and equipment to operate. Others run on laptops and lab benches. Some sell products today. Others spend years developing something that might never work.
These differences show up clearly when you look at Return on Assets – how much profit companies generate from their stuff. The numbers reveal which industries have figured out efficient ways to make money, and which ones are still trying.
How to Measure the Return on Assets (ROA) by industry?
ROA by industry measures how effectively companies in different sectors use their assets to generate net income. ROA is calculated as
ROA = Net Income/Total Assets(or Average Total Assets)
This calculation metrics is highly beneficial for comparing companies within the same industry, since asset intensity and profitability can vary between sectors.
ROA By Industry 2025
Here we added the key Insights of ROA 2025. This analysis examines Return on Assets (ROA) performance across 130 industries for 2025, revealing significant disparities in how effectively companies convert assets into profits. The data shows ROA ranging from 12.04% (Technology Consumer Electronics) to 0.87% (Diversified Banking) – a 14x performance gap.
The industries cluster into three distinct tiers: 21 elite performers above 8% ROA, 57 strong performers between 5-8%, and 52 underperformers below 5%. Technology dominates the top tier with multiple industries exceeding 7% ROA, while financial services and utilities concentrate heavily in the bottom tier, with most REITs and banks delivering sub-3% returns.
Top-Performing Industries
- Technology dominates the highest returns, with Consumer Electronics leading at 12.04% ROA. The technology sector consistently appears in the top tier, including Software Infrastructure (7.80%), Computer Hardware (7.67%), and Semiconductor Equipment & Materials (7.61%).
- Traditional “vice” industries perform exceptionally well, with Tobacco at 11.02% ROA, reflecting their strong cash generation and pricing power despite declining volumes.
- The energy sector shows strong performance in upstream activities, with Thermal Coal (10.32%) and Oil & Gas E&P (10.27%) both exceeding 10% ROA, likely benefiting from higher commodity prices.
In this table, we added industries with ROA above 8%.
| Sector | Industry | AVERAGE of ROA % |
|---|---|---|
| Technology | Consumer Electronics | 12.04% |
| Industrials | Airports & Air Services | 11.48% |
| Consumer Cyclical | Personal Services | 11.31% |
| Consumer Defensive | Tobacco | 11.02% |
| Energy | Thermal Coal | 10.32% |
| Energy | Oil & Gas E&P | 10.27% |
| Consumer Cyclical | Residential Construction | 9.87% |
| Communication Services | Electronic Gaming & Multimedia | 9.81% |
| Consumer Cyclical | Apparel Retail | 9.64% |
| Industrials | Building Products & Equipment | 9.50% |
| Industrials | Industrial Distribution | 9.12% |
| Basic Materials | Building Materials | 8.75% |
| Healthcare | Biotechnology | 8.69% |
| Healthcare | Drug Manufacturers—General | 8.67% |
| Consumer Defensive | Beverages—Non-Alcoholic | 8.55% |
| Industrials | Consulting Services | 8.45% |
| Consumer Cyclical | Restaurants | 8.30% |
| Consumer Defensive | Confectioners | 8.15% |
| Consumer Cyclical | Footwear & Accessories | 8.13% |
| Basic Materials | Copper | 8.12% |
| Healthcare | Drug Manufacturers—Specialty & Generic | 8.12% |
Clear Performance Tiers
The data reveals distinct performance clusters:
- Elite performers (8%+ ROA): 21 industries, predominantly technology, energy, and specialized consumer services
- Strong performers (5-8% ROA): 57 industries across diverse sectors
- Underperformers (<5% ROA): 52 industries, heavily weighted toward financial services, utilities, and real estate
In this table, we added industries with ROA above 5%.
| Sector | Industry | AVERAGE of ROA % |
|---|---|---|
| Consumer Cyclical | Specialty Retail | 7.69% |
| Technology | Computer Hardware | 7.67% |
| Technology | Semiconductor Equipment & Materials | 7.61% |
| Industrials | Metal Fabrication | 7.61% |
| Consumer Defensive | Household & Personal Products | 7.49% |
| Consumer Defensive | Discount Stores | 7.43% |
| Industrials | Integrated Freight & Logistics | 7.43% |
| Technology | Solar | 7.22% |
| Technology | Information Technology Services | 7.21% |
| Basic Materials | Coking Coal | 7.15% |
| Industrials | Specialty Industrial Machinery | 7.13% |
| Industrials | Electrical Equipment & Parts | 7.05% |
| Healthcare | Diagnostics & Research | 7.05% |
| Energy | Oil & Gas Midstream | 6.85% |
| Basic Materials | Steel | 6.85% |
| Basic Materials | Lumber & Wood Production | 6.81% |
| Consumer Cyclical | Auto Parts | 6.65% |
| Industrials | Farm & Heavy Construction Machinery | 6.60% |
| Communication Services | Internet Content & Information | 6.53% |
| Consumer Defensive | Food Distribution | 6.53% |
| Financial Services | Financial Data & Stock Exchanges | 6.49% |
| Basic Materials | Other Industrial Metals & Mining | 6.47% |
| Industrials | Tools & Accessories | 6.44% |
| Consumer Defensive | Packaged Foods | 6.41% |
| Industrials | Marine Shipping | 6.34% |
| Technology | Software—Application | 6.32% |
| Industrials | Security & Protection Services | 6.32% |
| Energy | Oil & Gas Integrated | 6.28% |
| Industrials | Pollution & Treatment Controls | 6.18% |
| Industrials | Engineering & Construction | 6.12% |
| Industrials | Specialty Business Services | 6.01% |
| Consumer Defensive | Education & Training Services | 5.99% |
| Consumer Cyclical | Textile Manufacturing | 5.98% |
| Basic Materials | Gold | 5.96% |
| Basic Materials | Paper & Paper Products | 5.95% |
| Consumer Cyclical | Leisure | 5.94% |
| Industrials | Railroads | 5.87% |
| Technology | Semiconductors | 5.78% |
| Basic Materials | Specialty Chemicals | 5.67% |
| Technology | Electronics & Computer Distribution | 5.66% |
| Consumer Defensive | Beverages—Brewers | 5.65% |
| Industrials | Staffing & Employment Services | 5.63% |
| Energy | Oil & Gas Equipment & Services | 5.61% |
| Real Estate | Real Estate—Development | 5.53% |
| Financial Services | Insurance Brokers | 5.42% |
| Consumer Cyclical | Apparel Manufacturing | 5.40% |
| Communication Services | Advertising Agencies | 5.35% |
| Industrials | Aerospace & Defense | 5.35% |
| Consumer Cyclical | Packaging & Containers | 5.33% |
| Healthcare | Medical Care Facilities | 5.31% |
| Healthcare | Medical Instruments & Supplies | 5.26% |
| Consumer Cyclical | Internet Retail | 5.25% |
| Consumer Cyclical | Resorts & Casinos | 5.24% |
| Consumer Cyclical | Furnishings, Fixtures & Appliances | 5.20% |
| Technology | Communication Equipment | 5.17% |
| Technology | Electronic Components | 5.12% |
| Healthcare | Medical Devices | 5.11% |
| Consumer Cyclical | Department Stores | 5.11% |
| Industrials | Trucking | 5.02% |
Sector-Specific Patterns
- Financial Services struggle consistently, with most subsectors showing ROA below 5%. Banks perform particularly poorly, with Regional Banks at just 1.00% and Diversified Banks at 0.87% ROA.
- Real Estate Investment Trusts (REITs) underperform, with most categories below 3% ROA. This likely reflects their high leverage and current interest rate environment.
- Utilities show consistently low returns, ranging from 2.21% to 4.52%, reflecting their capital-intensive, regulated nature.
- Healthcare shows mixed performance, with innovative segments like Biotechnology (8.69%) and Drug Manufacturers (8.67%) performing well, while service-oriented segments like Healthcare Plans (4.27%) and Medical Distribution (3.32%) lag.
In this table, we added industries with ROA below 5%.
| Sector | Industry | AVERAGE of ROA % |
|---|---|---|
| Consumer Cyclical | Travel Services | 4.93% |
| Consumer Cyclical | Gambling | 4.91% |
| Technology | Scientific & Technical Instruments | 4.86% |
| Industrials | Conglomerates | 4.85% |
| Consumer Cyclical | Auto & Truck Dealerships | 4.68% |
| Healthcare | Health Information Services | 4.65% |
| Industrials | Business Equipment & Supplies | 4.61% |
| Industrials | Waste Management | 4.59% |
| Industrials | Rental & Leasing Services | 4.52% |
| Utilities | Utilities—Regulated Water | 4.52% |
| Communication Services | Publishing | 4.34% |
| Real Estate | REIT—Industrial | 4.34% |
| Energy | Oil & Gas Drilling | 4.32% |
| Consumer Cyclical | Home Improvement Retail | 4.31% |
| Financial Services | Insurance—Specialty | 4.28% |
| Healthcare | Healthcare Plans | 4.27% |
| Communication Services | Entertainment | 4.25% |
| Financial Services | Credit Services | 4.09% |
| Communication Services | Broadcasting | 4.09% |
| Financial Services | Insurance—Reinsurance | 4.06% |
| Energy | Oil & Gas Refining & Marketing | 3.83% |
| Consumer Defensive | Grocery Stores | 3.79% |
| Consumer Defensive | Farm Products | 3.77% |
| Industrials | Airlines | 3.76% |
| Consumer Cyclical | Recreational Vehicles | 3.74% |
| Consumer Cyclical | Auto Manufacturers | 3.73% |
| Utilities | Utilities—Independent Power Producers | 3.72% |
| Utilities | Utilities—Regulated Gas | 3.57% |
| Communication Services | Telecom Services | 3.56% |
| Financial Services | Insurance—Diversified | 3.55% |
| Basic Materials | Chemicals | 3.44% |
| Basic Materials | Agricultural Inputs | 3.40% |
| Financial Services | Asset Management | 3.32% |
| Healthcare | Medical Distribution | 3.32% |
| Consumer Cyclical | Luxury Goods | 3.29% |
| Financial Services | Insurance—Property & Casualty | 3.26% |
| Utilities | Utilities—Regulated Electric | 3.22% |
| Real Estate | Real Estate Services | 3.20% |
| Real Estate | REIT—Specialty | 3.14% |
| Financial Services | Capital Markets | 3.02% |
| Real Estate | REIT—Retail | 2.81% |
| Basic Materials | Aluminum | 2.80% |
| Utilities | Utilities—Diversified | 2.54% |
| Real Estate | Real Estate—Diversified | 2.54% |
| Real Estate | REIT—Healthcare Facilities | 2.40% |
| Utilities | Utilities—Renewable | 2.21% |
| Real Estate | REIT—Diversified | 2.09% |
| Energy | Uranium | 2.02% |
| Real Estate | REIT—Residential | 2.01% |
| Real Estate | REIT—Hotel & Motel | 1.96% |
| Healthcare | Pharmaceutical Retailers | 1.87% |
| Financial Services | Financial Conglomerates | 1.75% |
| Real Estate | REIT—Mortgage | 1.63% |
| Financial Services | Mortgage Finance | 1.52% |
| Real Estate | REIT—Office | 1.49% |
| Financial Services | Insurance—Life | 1.49% |
| Basic Materials | Other Precious Metals & Mining | 1.43% |
| Basic Materials | Silver | 1.01% |
| Financial Services | Banks—Regional | 1.00% |
| Financial Services | Banks—Diversified | 0.87% |
Benchmarking Companies Within An Industry
In order to understand how well you’re performing againist your competitors, a comparison of your ROA to industry benchmarks is important. You can use the industry-specific ROA benchmarks to evaluate your company’s performance.
- Compare your ROA to Industry averages: If your ROA is higher than the benchmark, it suggests your company is more efficient at generating profits. If it’s lower, it indicates the underutilization of assets.
- Identify Strength and weaknesses: A higher-than -average ROA highlights operational strengths and lower-than average ROA points to potential weaknesses.
- Develop improvement strategies: If your ROA lags behind industry norms, consider optimizing asset utilization, streamlining operations, and increasing revenue through various measures.
- Monitor Trends: Track your ROI and industry benchmarks regularly to assess your performance that helps you respond proactively to industry shifts.
Note: ROA should not be your only measure of performance. For a comprehensive financial assessment you need to combine it with other metrics like return on equity, profit margins and ROI .
Know Your Numbers
Understanding your company’s financial position means more than just looking at profit and loss. You need to track how well you’re using your assets compared to others in your field. Whether you’re building houses or developing software, knowing your position helps you make better decisions about growth and investment.
Eqvista helps companies track their financial metrics and manage their equity structure in one place. Get clear visibility into your company’s performance and see how your ROA compares to industry standards. Start tracking your financial metrics with Eqvista today and make data-driven decisions for your business.
