Estee Lauder Companies Inc (EL)
Payables turnover
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,729,000 | 4,424,000 | 4,564,000 | 4,305,000 | 3,834,000 |
| Payables | US$ in thousands | 1,497,000 | 1,440,000 | 1,670,000 | 1,822,000 | 1,692,000 |
| Payables turnover | 2.49 | 3.07 | 2.73 | 2.36 | 2.27 |
June 30, 2025 calculation
Payables turnover = Cost of revenue ÷ Payables
= $3,729,000K ÷ $1,497,000K
= 2.49
The payables turnover ratio for Estee Lauder Companies Inc. reflects the company's efficiency in managing its accounts payable relative to its cost of goods sold (COGS) over the specified period. From June 30, 2021, to June 30, 2025, the ratio demonstrates a general upward trend, indicating a progressive improvement in the company's ability to settle its payables more frequently within a fiscal year.
Specifically, the ratio increased from 2.27 in 2021 to 2.36 in 2022, suggesting a modest acceleration in settling payables. This upward movement continued more markedly in subsequent years, reaching 2.73 in 2023 and further rising to 3.07 in 2024. The peak observed in 2024 signifies that the company was able to convert its payables into cash more rapidly, possibly reflecting improved liquidity, more stringent payable policies, or operational efficiencies.
However, in 2025, the ratio declined to 2.49, indicating a slight reduction in the frequency of paying off liabilities compared to the previous year. This decrease may imply a strategic change in payment policies, potentially extending payment terms or a temporary shift in operational liquidity management.
Overall, the trend in the payables turnover ratio suggests that Estee Lauder Companies Inc. has been strengthening its accounts payable management over the period analyzed, with improvements primarily occurring until 2024, followed by a modest retreat in 2025. The fluctuations should be interpreted in conjunction with other financial metrics to better understand the underlying cause of these shifts and their implications for the company's operational efficiency and liquidity position.
Peer comparison
Jun 30, 2025