Cadence Design Systems Inc (CDNS)

Current ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Total current assets	US$ in thousands	4,016,080	1,976,220	1,706,770	1,715,770	1,478,590
Total current liabilities	US$ in thousands	1,370,100	1,590,870	1,347,700	971,225	796,808
Current ratio		2.93	1.24	1.27	1.77	1.86

December 31, 2024 calculation

Current ratio = Total current assets ÷ Total current liabilities
= $4,016,080K ÷ $1,370,100K
= 2.93

The current ratio of Cadence Design Systems Inc has shown fluctuations over the past five years. As of December 31, 2020, the current ratio stood at 1.86, indicating that the company had $1.86 in current assets for every $1 in current liabilities. Subsequently, the ratio decreased slightly to 1.77 by December 31, 2021.

However, by the end of December 31, 2022, the current ratio experienced a more significant decrease to 1.27, signaling a potential liquidity concern as the company had $1.27 in current assets to cover each dollar of current liabilities. This trend continued into 2023 and 2024, where the current ratio fell to 1.24 and then sharply rose to 2.93, indicating a significant improvement in liquidity position by December 31, 2024.

Overall, the fluctuations in Cadence Design Systems Inc's current ratio may reflect changes in the company's liquidity position and its ability to meet short-term obligations. Investors and stakeholders should continue to monitor the trend of the current ratio to assess the company's financial health and liquidity management.