Advanced Micro Devices Inc (AMD)

Receivables 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
Revenue (ttm)	US$ in thousands	22,910,000	22,190,000	21,950,000	23,144,000	23,650,000	22,763,000	21,535,000	18,850,000	16,413,000	14,803,000	13,287,000	11,365,000	9,698,000	8,572,000	7,519,000	7,107,000	6,643,000	5,924,000	5,810,000	6,029,000
Receivables	US$ in thousands	6,476,000	5,055,000	4,312,000	—	5,226,000	4,340,000	4,053,000	3,681,000	3,035,000	2,229,000	2,026,000	2,185,000	2,189,000	2,138,000	1,799,000	1,896,000	2,056,000	1,586,000	1,731,000	1,644,000
Receivables turnover		3.54	4.39	5.09	—	4.53	5.24	5.31	5.12	5.41	6.64	6.56	5.20	4.43	4.01	4.18	3.75	3.23	3.74	3.36	3.67

December 31, 2023 calculation

Receivables turnover = Revenue (ttm) ÷ Receivables
= $22,910,000K ÷ $6,476,000K
= 3.54

The receivables turnover ratio measures how efficiently a company is able to collect cash from its credit sales. A higher turnover ratio indicates a shorter time frame for collecting outstanding receivables, which is generally viewed as a positive sign of liquidity and efficiency in managing accounts receivable.

Looking at the data provided for Advanced Micro Devices Inc over the past several quarters, we observe fluctuating trends in the receivables turnover ratio.

In the most recent quarter ending Dec 31, 2023, the receivables turnover ratio was 3.54, indicating that, on average, the company collected its receivables approximately 3.54 times during the period. This suggests that AMD took approximately 103 days (assuming 365 days in a year) to collect its outstanding receivables.

The trend in the receivables turnover ratio for AMD has shown some variability over the quarters, with some peaks and troughs. For instance, in the quarter ending Sep 30, 2021, the ratio was at its highest at 6.64, highlighting a shorter collection period, while in the quarter ending Mar 31, 2020, the ratio dropped to 3.75, indicating a longer collection period.

Overall, a general improving trend in the receivables turnover ratio over time would be preferable, as it would indicate that AMD is becoming more efficient in collecting its accounts receivable. However, it is also important to analyze this ratio in conjunction with other liquidity and efficiency metrics to gain a more comprehensive understanding of the company's financial health and operational performance.