ADEIA CORP (ADEA)

Working capital turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021
Revenue (ttm) US$ in thousands 376,024 343,723 359,019 354,886 388,788 405,210 393,110 417,708 438,933 433,922 564,004 678,461 761,525 721,073 704,491 619,850
Total current assets US$ in thousands 258,376 244,710 219,383 206,121 205,842 219,784 200,374 208,803 258,713 553,964 577,755 531,533 519,474 518,707 520,210 545,653
Total current liabilities US$ in thousands 73,106 71,498 73,223 92,604 102,038 81,912 86,111 98,558 166,712 225,395 210,899 196,440 189,747 208,623 179,890 187,892
Working capital turnover 2.03 1.98 2.46 3.13 3.75 2.94 3.44 3.79 4.77 1.32 1.54 2.02 2.31 2.33 2.07 1.73

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $376,024K ÷ ($258,376K – $73,106K)
= 2.03

The working capital turnover of ADEIA CORP has shown some fluctuations over the period from March 31, 2021, to December 31, 2024. The working capital turnover ratio indicates how efficiently a company is utilizing its working capital to generate sales revenue.

The trend of ADEIA CORP's working capital turnover ratio from 2021 to 2024 shows a general improvement, indicating that the company is becoming more efficient in generating sales relative to its working capital. The ratio increased from 1.73 on March 31, 2021, to 2.03 on December 31, 2024, with some ups and downs in between.

A higher working capital turnover ratio suggests that the company is able to generate more sales revenue using its working capital more effectively. It can indicate that ADEIA CORP is managing its current assets and liabilities efficiently, which is essential for liquidity management and overall financial health.

The significant increase in the working capital turnover from 1.32 on September 30, 2022, to 4.77 on December 31, 2022, should be further analyzed to understand the reasons behind this spike. It may indicate a temporary improvement in efficiency or changes in the company's operations that have positively impacted working capital utilization.

Overall, ADEIA CORP's working capital turnover ratio trend shows improvement over the period, but it is essential to analyze the underlying factors impacting this ratio to assess the company's operational efficiency and financial performance accurately.