Akamai Technologies Inc (AKAM)

Working capital turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Revenue (ttm) US$ in thousands 4,016,072 3,984,572 3,940,389 3,893,373 3,826,238 3,733,857 3,652,471 3,620,307 3,608,242 3,585,821 3,548,899 3,483,286 3,407,208 3,348,137 3,281,469 3,224,148 3,146,371 3,072,207 2,995,310 2,915,391
Total current assets US$ in thousands 2,578,100 2,634,430 2,570,460 2,625,180 1,804,860 1,867,380 1,718,470 1,697,710 1,969,560 1,695,570 1,566,160 1,464,480 1,920,430 2,761,880 2,253,250 2,161,400 1,929,530 2,243,220 2,193,000 2,014,580
Total current liabilities US$ in thousands 2,091,320 1,983,020 1,945,880 808,938 836,038 810,491 860,774 836,253 818,868 753,011 817,084 869,265 790,341 731,440 647,449 715,131 758,170 717,124 657,422 630,247
Working capital turnover 8.25 6.12 6.31 2.14 3.95 3.53 4.26 4.20 3.14 3.80 4.74 5.85 3.01 1.65 2.04 2.23 2.69 2.01 1.95 2.11

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $4,016,072K ÷ ($2,578,100K – $2,091,320K)
= 8.25

The working capital turnover ratio for Akamai Technologies Inc has shown fluctuating trends over the periods indicated in the data. The ratio measures how efficiently the company is utilizing its working capital to generate sales revenue.

In the first quarter of 2020, the ratio was 2.11, indicating that Akamai was able to generate $2.11 in sales revenue for every $1 of working capital invested. The ratio declined slightly in the subsequent quarters but picked up significantly in the fourth quarter of 2020, reaching 2.69, signaling improved efficiency in working capital utilization.

Throughout 2021 and early 2022, the ratio remained relatively stable, ranging between 1.65 and 5.85, indicating variations in how efficiently Akamai was managing its working capital during these periods. However, in the second half of 2022 and 2023, the ratio consistently stayed above 3, suggesting a more efficient utilization of working capital to generate revenue.

In the last few quarters of the data provided, particularly in the fourth quarters of 2023 and 2024, the working capital turnover ratio surged significantly, reaching 8.25. This implies that Akamai was effectively generating sales revenue relative to its working capital investment, reflecting strong operational efficiency during these periods.

Overall, the working capital turnover ratios for Akamai have demonstrated fluctuations over time, but with some quarters showing a notable improvement in efficiency in utilizing working capital to drive sales revenue. It is essential for the company to continuously monitor and manage its working capital effectively to support sustainable growth and profitability.