Broadcom Inc (AVGO)
Working capital turnover
| Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Nov 1, 2020 | Nov 3, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 35,819,000 | 33,203,000 | 27,450,000 | 23,888,000 | 22,597,000 |
| Total current assets | US$ in thousands | 20,847,000 | 18,504,000 | 16,586,000 | 11,895,000 | 9,917,000 |
| Total current liabilities | US$ in thousands | 7,405,000 | 7,052,000 | 6,281,000 | 6,371,000 | 6,899,000 |
| Working capital turnover | 2.66 | 2.90 | 2.66 | 4.32 | 7.49 |
October 29, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $35,819,000K ÷ ($20,847,000K – $7,405,000K)
= 2.66
Working capital turnover is a measure of how efficiently a company utilizes its working capital to generate sales. A higher working capital turnover ratio generally indicates effective management of working capital.
Based on the data provided, Broadcom Inc's working capital turnover has seen fluctuations over the past five years. In October 2023, the working capital turnover stood at 2.66, a decrease from the previous year's figure of 2.90. This indicates that the company generated $2.66 in net sales revenue for every dollar of working capital in the most recent year.
Comparing this to the figures from prior years, the working capital turnover has shown a downward trend since November 3, 2019, when it was as high as 7.49. This significant decrease may suggest a potential decrease in the efficiency of utilizing working capital to generate sales.
It's essential to correlate this ratio with other financial metrics to gain a comprehensive understanding of the company's financial performance and working capital management. Further analysis, complemented by other ratios and financial indicators, can provide deeper insights into Broadcom Inc's overall operational efficiency and financial health.
Peer comparison
Oct 29, 2023