Costco Wholesale Corp (COST)

Working capital turnover

		Sep 1, 2024	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020
Revenue	US$ in thousands	254,453,000	242,290,000	226,954,000	195,929,000	166,761,000
Total current assets	US$ in thousands	34,246,000	35,879,000	32,696,000	29,505,000	28,120,000
Total current liabilities	US$ in thousands	35,464,000	33,583,000	31,998,000	29,441,000	24,844,000
Working capital turnover		—	105.53	325.15	3,061.39	50.90

September 1, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $254,453,000K ÷ ($34,246,000K – $35,464,000K)
= —

The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. Costco Wholesale Corp's working capital turnover has shown significant fluctuations over the past five years.

In August 2021, the working capital turnover was extremely high at 3,061.39, indicating that Costco was generating a high level of sales relative to its working capital. This could be attributed to efficient management of inventory levels and receivables.

In the following year, the working capital turnover dropped substantially to 325.15, which is still relatively high but significantly lower compared to the previous year. This decrease could suggest a change in the company's operating efficiency or a shift in its working capital management strategy.

The most recent data available for September 2023 shows a working capital turnover of 105.53, indicating a further decline in the efficiency of working capital utilization compared to the previous year. This could be a cause for concern as it may imply that Costco's ability to generate sales revenue using its working capital has decreased.

Overall, while Costco's working capital turnover has shown fluctuations over the years, investors and analysts may want to further investigate the reasons behind the changes to assess the company's operational efficiency and financial performance.