DigitalOcean Holdings Inc (DOCN)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 314,672 | 295,387 | 211,927 | 170,595 |
| Payables | US$ in thousands | 54,565 | 3,957 | 21,138 | 12,657 |
| Payables turnover | 5.77 | 74.65 | 10.03 | 13.48 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $314,672K ÷ $54,565K
= 5.77
DigitalOcean Holdings Inc's payables turnover has shown fluctuations over the years. In December 31, 2021, the payables turnover ratio stood at 13.48, indicating that the company took approximately 13.48 times to pay off its accounts payable during that year.
The ratio decreased to 10.03 in December 31, 2022, suggesting a slower rate of paying off its suppliers compared to the previous year. However, there was a significant increase in the payables turnover to 74.65 by December 31, 2023, reflecting a much shorter time taken to settle its payables relative to the previous years. This sudden spike may indicate either more efficient management of payables or changes in the company's payment terms with suppliers.
By December 31, 2024, the payables turnover ratio decreased to 5.77, signaling that the company took a comparatively longer time to pay off its creditors during that year. This drop could be due to various reasons such as changes in the company's purchasing patterns or supplier relations.
Overall, changes in the payables turnover ratio can reflect DigitalOcean's efficiency in managing its accounts payable and cash flow. Investors and stakeholders may closely monitor these fluctuations to assess the company's liquidity position and operational effectiveness.
Peer comparison
Dec 31, 2024