Akamai Technologies Inc (AKAM)

Payables turnover

		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	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cost of revenue (ttm)	US$ in thousands	1,511,063	1,475,634	1,439,009	1,412,383	1,383,819	1,351,254	1,321,670	1,295,021	1,268,956	1,247,400	1,213,973	1,170,777	1,132,672	1,086,575	1,050,074	1,015,463	987,624	973,801	966,109	959,403
Payables	US$ in thousands	146,927	144,466	194,493	202,129	145,420	119,051	131,649	122,934	109,928	98,305	93,465	119,462	118,546	114,850	153,958	114,100	138,946	108,187	126,539	102,371
Payables turnover		10.28	10.21	7.40	6.99	9.52	11.35	10.04	10.53	11.54	12.69	12.99	9.80	9.55	9.46	6.82	8.90	7.11	9.00	7.63	9.37

December 31, 2023 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $1,511,063K ÷ $146,927K
= 10.28

The payables turnover ratio measures how efficiently a company is managing its accounts payable by evaluating how many times a company pays off its average accounts payable balance during a specific period.

Based on the data provided for Akamai Technologies Inc, we observe fluctuations in the payables turnover ratio over the past eight quarters.

In Q4 2023, the payables turnover ratio improved to 10.28 from 10.21 in Q3 2023, indicating that the company was able to pay off its accounts payable more frequently during this period. This could suggest better management of payables or improved relationships with suppliers.

However, in Q2 2023 and Q1 2023, the payables turnover ratios dropped to 7.40 and 6.99, respectively, indicating a slower rate of paying off accounts payable compared to the previous quarters. This could be a red flag as it may imply challenges in managing cash flow or delays in payments to suppliers.

Looking further back, in Q4 2022, the company had a payables turnover ratio of 9.52, a slight decrease from Q3 2022 when it was 11.35. The downward trend from Q3 to Q4 2022 suggests a potential slowdown in payables turnover during that period.

Overall, while the payables turnover ratios for Akamai Technologies Inc have shown some variability, it is important for the company to consistently monitor and manage its accounts payable effectively to maintain liquidity, supplier relationships, and operational efficiency.