Alpha and Omega Semiconductor Ltd (AOSL)

Quick ratio

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Cash	US$ in thousands	175,127	195,188	314,352	202,412	158,536
Short-term investments	US$ in thousands	—	—	100	—	—
Receivables	US$ in thousands	15,647	23,693	66,451	38,064	13,341
Total current liabilities	US$ in thousands	154,233	172,561	267,722	233,230	192,058
Quick ratio		1.24	1.27	1.42	1.03	0.89

June 30, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($175,127K + $—K + $15,647K) ÷ $154,233K
= 1.24

The quick ratio of Alpha and Omega Semiconductor Ltd has shown a generally positive trend over the past five years, indicating an improving short-term liquidity position. The company's ability to meet its short-term obligations with its most liquid assets has strengthened over time.

In particular, the quick ratio increased from 0.89 in 2020 to 1.24 in 2024, with slight fluctuations in between. This suggests that the company has enhanced its ability to cover its current liabilities with its quick assets like cash, cash equivalents, and accounts receivable.

A quick ratio above 1.0 indicates that the company has an adequate level of quick assets to cover its current liabilities, thereby suggesting a lower liquidity risk. Alpha and Omega Semiconductor Ltd's quick ratio consistently above 1.0 demonstrates a prudent approach in managing short-term liquidity and meeting its near-term financial obligations.

Overall, the increasing trend in the quick ratio reflects positively on the company's liquidity management and suggests a potential ability to weather short-term financial challenges.