Advanced Micro Devices Inc (AMD)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	18,025,000	19,508,000	10,360,000	6,723,000	4,613,000
Payables	US$ in thousands	2,055,000	2,493,000	1,321,000	468,000	988,000
Payables turnover		8.77	7.83	7.84	14.37	4.67

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $18,025,000K ÷ $2,055,000K
= 8.77

The payables turnover ratio for Advanced Micro Devices Inc has shown fluctuations over the past five years. In 2023, the payables turnover ratio increased to 8.77 compared to the previous year, indicating that the company was able to convert its accounts payables into cash more frequently during the year. This improvement suggests that AMD's management may have implemented more efficient payables management strategies or negotiated better payment terms with suppliers, leading to a quicker turnover of payables.

Comparing to the data from 2022 and 2021 where the payables turnover ratios were 7.83 and 7.84 respectively, 2023's higher ratio signifies a more efficient management of accounts payables. However, the payables turnover ratio in 2020 was notably higher at 14.37, suggesting that the company was paying off its suppliers at a much faster rate that year. In contrast, the ratio dropped significantly in 2019 to 4.67, indicating a slower turnover of payables relative to the other years in the dataset.

Overall, the increasing trend in the payables turnover ratio for Advanced Micro Devices Inc from 2019 to 2023 reflects improved efficiency in managing its accounts payables and highlights the company's ability to effectively utilize its working capital to meet its short-term obligations.