Align Technology Inc (ALGN)

Total asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	3,862,260	3,734,640	3,952,580	2,471,940	2,406,800
Total assets	US$ in thousands	6,083,880	5,947,950	5,942,110	4,829,680	2,500,700
Total asset turnover		0.63	0.63	0.67	0.51	0.96

December 31, 2023 calculation

Total asset turnover = Revenue ÷ Total assets
= $3,862,260K ÷ $6,083,880K
= 0.63

The total asset turnover ratio measures how efficiently a company utilizes its assets to generate revenue. Align Technology, Inc.'s total asset turnover has shown some fluctuation over the past five years. In 2023 and 2022, the company maintained a relatively stable total asset turnover ratio of 0.63, indicating that for every dollar of assets, the company generated $0.63 in revenue.

In 2021, the total asset turnover ratio increased to 0.67, suggesting that Align utilized its assets more efficiently to generate revenue compared to the previous year. However, there was a notable decrease in 2020, with the ratio falling to 0.51, indicating a potential decline in asset efficiency during that period.

The most significant observation is in 2019 when Align Technology, Inc. achieved a total asset turnover ratio of 0.96, signifying a high level of efficiency in utilizing its assets to generate revenue. This peak in efficiency suggests that the company effectively generated $0.96 in revenue for every dollar of assets in that year.

Overall, while the total asset turnover ratio of Align Technology, Inc. has shown variation over the years, it is essential for the company to monitor this metric to ensure optimal asset utilization and revenue generation in the future.