CarGurus (CARG)

Fixed asset 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	917,072	980,534	1,187,569	1,459,061	1,657,093	1,707,547	1,504,008	1,210,527	951,422	763,580	688,137	565,126	551,498	558,153	561,143	611,437	589,749	557,686	526,266	491,560
Property, plant and equipment	US$ in thousands	83,370	54,700	48,243	42,748	40,128	36,833	35,343	33,101	32,210	29,569	31,641	29,816	27,483	27,276	26,881	27,904	27,950	27,568	28,638	26,550
Fixed asset turnover		11.00	17.93	24.62	34.13	41.30	46.36	42.55	36.57	29.54	25.82	21.75	18.95	20.07	20.46	20.88	21.91	21.10	20.23	18.38	18.51

December 31, 2023 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $917,072K ÷ $83,370K
= 11.00

The fixed asset turnover ratio measures how efficiently a company is utilizing its fixed assets to generate revenue. A higher fixed asset turnover ratio indicates that the company is generating more revenue per dollar of fixed assets.

Analyzing CarGurus Inc's fixed asset turnover ratio over the past eight quarters, we observe a fluctuating trend. The ratio has shown an increasing trend from Q1 2022 to Q2 2023, reaching a peak of 46.36 in Q3 2022. This indicates that the company was effectively generating revenue relative to its fixed asset base during this period.

However, in the most recent quarter (Q4 2023), the fixed asset turnover ratio has decreased to 10.97, which is a significant drop from the previous quarter. This decline suggests that CarGurus Inc may be experiencing challenges in efficiently utilizing its fixed assets to generate revenue in the current operating environment.

It is essential for the company to closely monitor and potentially optimize its fixed asset utilization to improve the efficiency of its operations and drive higher revenue generation in the future. Further analysis of the company's operational strategies and investment in fixed assets may help in understanding the fluctuations in the fixed asset turnover ratio over the quarters.