Analog Devices Inc (ADI)

Working capital turnover

		Nov 2, 2024	Oct 28, 2023	Oct 29, 2022	Oct 30, 2021	Oct 31, 2020
Revenue	US$ in thousands	9,439,960	12,053,800	11,813,500	6,931,870	5,409,750
Total current assets	US$ in thousands	5,484,650	4,384,020	4,937,990	5,378,320	2,517,690
Total current liabilities	US$ in thousands	2,988,280	3,200,970	2,442,660	2,770,310	1,364,990
Working capital turnover		3.78	10.19	4.73	2.66	4.69

November 2, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $9,439,960K ÷ ($5,484,650K – $2,988,280K)
= 3.78

The working capital turnover ratio for Analog Devices Inc has fluctuated over the past five years. In the most recent fiscal year ending on November 2, 2024, the company's working capital turnover ratio was 3.78, indicating that the company generated $3.78 in net sales for every dollar of working capital invested.

Comparing this to the previous year, there was a significant decrease in efficiency as the ratio dropped from 10.19 in fiscal year 2023 to 3.78 in fiscal year 2024. This decrease suggests that the company was less effective in utilizing its working capital to generate sales in the most recent year.

Looking back over the five-year period, the working capital turnover ratio has varied, with the highest ratio of 10.19 in fiscal year 2023 and the lowest ratio of 2.66 in fiscal year 2021. Overall, the company's working capital turnover has shown some volatility, indicating fluctuations in how efficiently Analog Devices Inc has been able to use its working capital to generate sales.

It is important for the company to closely monitor its working capital turnover ratio as it reflects the efficiency of its operations and how effectively it is managing its working capital to drive revenue generation. Further analysis and tracking of this ratio can help Analog Devices Inc make informed decisions regarding its working capital management strategies.