Akamai Technologies Inc (AKAM)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	3,826,240	3,631,300	3,409,920	3,151,090	2,849,370
Property, plant and equipment	US$ in thousands	1,825,940	1,540,180	1,534,330	1,478,270	1,152,150
Fixed asset turnover		2.10	2.36	2.22	2.13	2.47

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $3,826,240K ÷ $1,825,940K
= 2.10

The fixed asset turnover ratio measures a company's ability to generate revenue from its investment in fixed assets. A higher fixed asset turnover ratio indicates that the company is efficiently utilizing its fixed assets to generate sales revenue.

In the case of Akamai Technologies Inc, the fixed asset turnover has shown some fluctuations over the past five years. From 2019 to 2020, the ratio increased from 2.51 to 2.16, which could suggest a decrease in the company's efficiency in utilizing its fixed assets to generate revenue. However, there was a rebound in 2021 when the ratio improved to 2.26, indicating a slight improvement in asset utilization.

In 2022, the fixed asset turnover ratio further increased to 2.35, suggesting that Akamai was more effective in generating sales from its fixed assets. However, in 2023, the ratio dipped to 2.09, which may indicate a slight decrease in efficiency in leveraging fixed assets to drive revenue.

Overall, while Akamai Technologies Inc has experienced some variability in its fixed asset turnover ratio over the years, it generally demonstrates a reasonable level of efficiency in using its fixed assets to generate sales. Further analysis and comparison with industry benchmarks may provide additional insights into the company's asset management effectiveness.