ADEIA CORP (ADEA)

Cash ratio

		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	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020
Cash and cash equivalents	US$ in thousands	54,560	51,855	60,470	82,429	114,555	271,092	275,319	214,095	80,428	165,438	128,960	134,759	170,188	115,725	174,013
Short-term investments	US$ in thousands	34,790	34,303	28,174	3,923	4,107	6,856	14,444	58,658	72,906	76,442	77,336	107,194	90,796	92,029	117,115
Total current liabilities	US$ in thousands	102,038	81,912	86,111	98,558	166,712	225,395	210,899	196,440	189,747	208,623	179,890	187,892	224,671	207,947	214,455
Cash ratio		0.88	1.05	1.03	0.88	0.71	1.23	1.37	1.39	0.81	1.16	1.15	1.29	1.16	1.00	1.36

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($54,560K + $34,790K) ÷ $102,038K
= 0.88

The cash ratio measures a company's ability to cover its short-term liabilities solely with its cash and cash equivalents. ADEIA CORP's cash ratio has fluctuated over the past few quarters. It peaked at 1.39 in March 2022, indicating that the company had sufficient cash to cover its short-term obligations at that time. However, the ratio dropped to 0.71 in December 2022, suggesting a decrease in the company's ability to meet its short-term liabilities with cash alone.

The most recent cash ratio of 0.88 as of December 31, 2023, indicates an improvement from the previous quarter but still falls below the ideal benchmark of 1, which may raise concerns about the company's liquidity position. It is important for ADEIA CORP to monitor and manage its cash levels effectively to ensure it can meet its short-term financial obligations in a timely manner.

Overall, the trend in ADEIA CORP's cash ratio highlights the importance of maintaining a healthy cash position to ensure financial stability and meet short-term financial commitments.