Salesforce.com Inc (CRM)
Liquidity ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.09 | 1.04 | 1.02 | 1.02 | 1.02 | 1.05 | 1.06 | 1.03 | 1.05 | 1.06 | 0.93 | 1.33 | 1.23 | 1.22 | 1.15 | 1.15 | 1.08 | 1.05 | 0.97 | 0.96 |
| Quick ratio | 0.96 | 0.86 | 0.86 | 0.86 | 0.90 | 0.90 | 0.92 | 0.89 | 0.95 | 0.93 | 0.85 | 1.28 | 1.23 | 1.23 | 1.05 | 1.00 | 0.95 | 0.87 | 0.82 | 0.81 |
| Cash ratio | 0.54 | 0.61 | 0.60 | 0.65 | 0.48 | 0.66 | 0.69 | 0.69 | 0.50 | 0.66 | 0.61 | 1.07 | 0.79 | 0.96 | 0.78 | 0.76 | 0.54 | 0.62 | 0.59 | 0.61 |
The liquidity ratios of Salesforce Inc have been relatively stable over the past eight quarters, indicating the company's ability to meet its short-term obligations. The current ratio has generally been around 1.02 to 1.09, suggesting that Salesforce has slightly more current assets than current liabilities, which is a positive sign. The quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, has also mirrored the current ratio trends.
The cash ratio, which is the most conservative liquidity ratio, has ranged from 0.60 to 0.83. Although the cash ratio has been lower compared to the current and quick ratios, it indicates that Salesforce holds a sufficient amount of cash to cover its immediate liabilities.
Overall, the liquidity ratios of Salesforce Inc show a healthy financial position with the ability to meet its short-term financial obligations effectively. It is important to continue monitoring these ratios to ensure ongoing liquidity and financial stability.
See also:
Salesforce.com Inc Liquidity Ratios (Quarterly Data)
Additional liquidity measure
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 119.48 | 74.26 | 82.08 | 74.48 | 148.08 | 71.35 | 77.81 | 69.74 | 147.79 | 73.74 | 79.80 | 70.40 | 149.66 | 77.67 | 81.67 | 78.51 | 150.12 | 78.31 | 78.45 | 77.59 |
The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A shorter cash conversion cycle generally indicates that the company is efficient in managing its working capital and turning its resources into cash quickly.
In the case of Salesforce Inc, we observe fluctuations in its cash conversion cycle over the past eight quarters. The cycle ranged from a low of 51.51 days in Q3 2023 to a high of 125.21 days in Q4 2023. This fluctuation suggests variability in the company's management of working capital and cash flow efficiency.
The trend over the most recent quarters shows an increase in the cash conversion cycle, reaching 119.52 days in Q4 2024. This could indicate potential challenges in managing inventory, collecting receivables, or extending payables, which may result in a longer time to convert investments into cash flows.
It is important for Salesforce Inc to closely monitor and manage its cash conversion cycle to ensure optimal efficiency in working capital management and cash flow generation. By identifying and addressing the factors contributing to the lengthening of the cycle, the company can improve its liquidity position and overall financial performance.