Salesforce.com Inc (CRM)

Working capital turnover

		Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020	Jan 31, 2020	Oct 31, 2019	Jul 31, 2019	Apr 30, 2019
Revenue (ttm)	US$ in thousands	34,869,000	33,714,000	32,766,000	31,966,000	31,213,000	30,389,000	30,006,000	29,252,000	28,129,000	26,979,000	24,988,000	23,197,000	22,027,000	20,756,000	19,969,000	18,704,000	17,469,000	16,221,000	14,952,000	14,307,000
Total current assets	US$ in thousands	29,074,000	20,202,000	21,138,000	21,981,000	26,395,000	19,209,000	21,246,000	20,411,000	22,850,000	15,957,000	16,256,000	20,444,000	21,889,000	14,946,000	14,846,000	14,713,000	15,963,000	11,026,000	9,903,000	10,035,000
Total current liabilities	US$ in thousands	26,631,000	19,394,000	20,805,000	21,626,000	25,891,000	18,227,000	20,080,000	19,899,000	21,788,000	15,035,000	17,393,000	15,323,000	17,728,000	12,234,000	12,963,000	12,843,000	14,845,000	10,474,000	10,195,000	10,488,000
Working capital turnover		14.27	41.73	98.40	90.05	61.93	30.95	25.73	57.13	26.49	29.26	—	4.53	5.29	7.65	10.60	10.00	15.63	29.39	—	—

January 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $34,869,000K ÷ ($29,074,000K – $26,631,000K)
= 14.27

The working capital turnover ratio indicates how effectively a company is utilizing its working capital to generate revenue. A higher ratio suggests efficient use of working capital, while a lower ratio may indicate inefficiency.

On analyzing Salesforce Inc's working capital turnover ratio over the past eight quarters, a trend of fluctuation is observed. In Q1 2024, the working capital turnover ratio dropped to 90.67 from 99.31 in Q2 2024, which could potentially indicate a decrease in efficiency in converting working capital into revenue. However, this was followed by a significant increase in Q2 2024 to 99.31, suggesting a rapid improvement in the company's working capital management.

Comparing these recent results with the corresponding quarters of the previous year, there seems to be a general upward trend in the working capital turnover ratio. For instance, the ratio has more than doubled from Q1 2023 to Q1 2024. This suggests a positive development in Salesforce Inc's ability to generate revenue from its working capital over time.

Overall, while there have been fluctuations in the working capital turnover ratio of Salesforce Inc, the general trend indicates an improvement in the company's efficiency in utilizing its working capital to drive revenue generation. It would be advisable for stakeholders to continue monitoring this ratio to ensure sustained efficiency in working capital management.