Arlo Technologies (ARLO)

Short-term

Turnover ratios

Arlo Technologies Inc's activity ratios provide insights into how efficiently the company is managing its assets and liabilities.

1. Inventory turnover: Arlo's inventory turnover has been consistently high over the quarters, ranging from 5.17 to 9.76. This indicates that the company is efficient in selling its inventory and replenishing it quickly, which is a positive sign for operational efficiency.

2. Receivables turnover: The receivables turnover for Arlo has also been relatively stable, with values ranging from 6.12 to 9.02. This ratio reflects how quickly the company collects payment from its customers. A higher turnover ratio suggests that Arlo is effectively managing its accounts receivable and collecting payments promptly.

3. Payables turnover: The payables turnover ratio for Arlo has fluctuated but generally remained between 3.54 and 7.36. A higher payables turnover ratio indicates that the company is paying its suppliers quickly, which could help maintain good relationships and potentially negotiate better terms.

4. Working capital turnover: Arlo's working capital turnover has shown variations over the quarters, ranging from 5.12 to 7.20. This ratio measures how efficiently the company is using its working capital to generate sales. A higher turnover ratio implies that Arlo is effectively utilizing its working capital to support its operations and generate revenue.

Overall, based on these activity ratios, Arlo Technologies Inc appears to be managing its assets and liabilities efficiently, turning inventory and receivables quickly while also effectively managing its payables and working capital.

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Average number of days

Arlo Technologies Inc's activity ratios provide insight into the efficiency of the company's operations.

1. Days of Inventory on Hand (DOH): This ratio indicates the average number of days it takes for the company to sell its inventory. A lower DOH is generally preferred as it suggests faster inventory turnover. Arlo's DOH has fluctuated over the quarters, ranging from a low of 38.23 days in Q2 2022 to a high of 70.54 days in Q3 2022. The recent trend shows improvement, with Q4 2023 at 43.32 days, potentially indicating more efficient inventory management.

2. Days of Sales Outstanding (DSO): DSO measures how long it takes for the company to collect payment from its customers. A lower DSO is favorable as it signifies faster cash collection. Arlo's DSO has varied, with Q1 2023 having the lowest DSO of 40.46 days and Q3 2023 recording the highest at 58.65 days. The company has shown improvement in Q4 2023 with a DSO of 48.57 days, indicating enhanced receivables management.

3. Number of Days of Payables: This ratio represents the average number of days the company takes to pay its suppliers. A higher number of days suggests the company is taking longer to pay its bills, which can be beneficial from a cash flow standpoint. Arlo's number of days of payables has also fluctuated, with Q3 2022 having the highest at 103.16 days and Q4 2022 recording the lowest at 53.69 days. The recent Q4 2023 figure of 62.26 days indicates a moderate payables period relative to previous quarters.

Overall, Arlo Technologies Inc's activity ratios reflect some variability in managing inventory, receivables, and payables. The company should continue to focus on optimizing these ratios to enhance operational efficiency and cash flow management.

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Long-term

Arlo Technologies Inc's fixed asset turnover has shown a fluctuating trend over the past eight quarters, with the highest value recorded in Q4 2023 at 103.17 and the lowest in Q1 2022 at 56.01. This ratio indicates that the company generates significant revenue relative to its investment in fixed assets. The company seems to have improved its efficiency in utilizing fixed assets in generating sales, as seen from the generally increasing trend in recent quarters.

In contrast, the total asset turnover ratio has also exhibited variability over the same period, with values ranging from 1.53 in Q1 2022 to 1.85 in Q1 2023. This ratio reflects Arlo Technologies Inc's ability to generate sales in relation to its total assets. The upward trend from Q1 2022 to Q1 2023 suggests that the company has become more efficient in generating revenue from its total asset base.

Overall, the fixed asset turnover ratio indicates efficient utilization of fixed assets in generating sales, and the total asset turnover ratio reflects the company's effectiveness in generating sales from its total asset base. These ratios provide insights into the company's operational efficiency and asset management strategies over the past eight quarters.