Analog Devices Inc (ADI)

Payables turnover

		Nov 2, 2024	Oct 28, 2023	Oct 29, 2022	Oct 30, 2021	Oct 31, 2020
Cost of revenue	US$ in thousands	6,851,710	7,862,620	8,036,360	4,636,510	3,201,990
Payables	US$ in thousands	487,457	493,041	582,160	443,434	227,273
Payables turnover		14.06	15.95	13.80	10.46	14.09

November 2, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $6,851,710K ÷ $487,457K
= 14.06

Analog Devices Inc's payables turnover ratio has fluctuated over the past five years, ranging from 10.46 to 15.95. The payables turnover ratio measures how efficiently a company manages its trade payables by indicating the number of times a company pays off its average accounts payable balance during a specific period.

In this case, Analog Devices Inc's payables turnover ratio was the highest in October 2023 at 15.95, suggesting that the company paid off its accounts payable almost 16 times during that year. This level of turnover indicates efficient management of payables.

On the other hand, the lowest payables turnover ratio was observed in October 2021 at 10.46, reflecting a decrease in the frequency of paying off accounts payable during that period. However, it is important to note that a lower payables turnover ratio is not necessarily negative, as it could also be influenced by various factors such as negotiating better payment terms with suppliers or managing cash flow strategically.

Overall, Analog Devices Inc's payables turnover ratio has shown variability over the years, indicating fluctuations in the company's efficiency in managing its trade payables. Further analysis of the company's financial performance and operational strategies would be necessary to fully understand the implications of these fluctuations.