Digi International Inc (DGII)

Payables turnover

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Cost of revenue (ttm)	US$ in thousands	174,140	181,490	186,962	189,850	192,646	191,217	188,891	183,348	171,939	161,676	152,108	146,223	141,974	141,145	137,611	135,573	135,299	134,013	133,862	134,491
Payables	US$ in thousands	23,759	20,856	22,205	16,679	17,148	21,503	20,725	30,633	32,373	27,949	22,769	22,880	22,586	18,840	18,911	22,472	28,067	21,929	17,421	23,165
Payables turnover		7.33	8.70	8.42	11.38	11.23	8.89	9.11	5.99	5.31	5.78	6.68	6.39	6.29	7.49	7.28	6.03	4.82	6.11	7.68	5.81

September 30, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $174,140K ÷ $23,759K
= 7.33

The payables turnover ratio measures how efficiently a company is managing its accounts payable by analyzing how many times the company pays off its suppliers within a specific period. A higher payables turnover ratio indicates that the company is paying off its suppliers more frequently, which may suggest strong liquidity and good relationships with suppliers.

Analyzing the payables turnover ratio of Digi International Inc over the past few quarters, we observe some fluctuations. As of September 30, 2024, the payables turnover ratio stands at 7.33, indicating that the company is paying its suppliers approximately 7.33 times a year. This represents a decrease from the previous quarter's ratio of 8.70, suggesting that the company took longer to pay off its suppliers in this period.

Looking further back, we notice a general trend of fluctuating payables turnover ratios, with some quarters showing higher ratios (e.g., 11.38 in December 31, 2023), while others showing lower ratios (e.g., 4.82 in December 31, 2020). These fluctuations may reflect varying payment cycles, changes in supplier terms, or shifts in business operations.

Overall, while the payables turnover ratio of Digi International Inc has shown variability over the quarters, it is important to consider the industry norms and benchmark against competitors to gain more insights into the company's management of accounts payable.