# What is ROE?

Informational only - not investment advice.

Book: [Reading Financial Data - Step by Step](/guide/)
Chapter: [Cash flow & returns](/guide/cash-flow-returns/)
As of: 2025-10-31

ROE compares net income with stockholders' equity.

## Concept

ROE = net income / equity. Always read the denominator before comparing the percentage.

## Worked Example: Compute Apple return on equity

1. AAPL net income was $112.0 billion in fiscal 2025.
2. AAPL stockholders' equity was $73.7 billion.
3. ROE = net income / equity = $112.0 billion / $73.7 billion = 151.91%.
4. Apple's equity is much smaller than its assets, partly because share repurchases reduce equity.
5. That smaller denominator can make ROE very high. ROE is a context-dependent ratio, not a standalone verdict.

## See it live

- [AAPL company page](/company/AAPL/)

## Sources

- [AAPL SEC companyfacts](https://data.sec.gov/api/xbrl/companyfacts/CIK0000320193.json)
- [AAPL latest 10-K source](https://www.sec.gov/Archives/edgar/data/320193/000032019325000079/aapl-20250927.htm)