Enphase Energy Inc (ENPH)

Working capital turnover

		Dec 31, 2024	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
Revenue (ttm)	US$ in thousands	1,330,383	1,250,240	1,420,449	1,828,109	2,290,786	2,712,868	2,796,499	2,615,577	2,330,853	2,018,920	1,735,726	1,521,587	1,382,049	1,234,169	1,061,153	870,634	774,425	719,618	721,172	729,728
Total current assets	US$ in thousands	2,327,080	2,360,880	2,241,650	2,302,570	2,443,520	2,598,630	2,560,790	2,512,630	2,264,270	1,982,660	1,735,990	1,558,780	1,462,460	1,768,080	1,665,920	1,791,360	933,064	850,234	757,201	751,697
Total current liabilities	US$ in thousands	660,091	567,478	529,632	554,095	532,449	774,387	743,605	729,289	638,219	550,236	480,010	453,756	439,796	393,455	356,593	344,473	534,043	256,519	223,523	233,622
Working capital turnover		0.80	0.70	0.83	1.05	1.20	1.49	1.54	1.47	1.43	1.41	1.38	1.38	1.35	0.90	0.81	0.60	1.94	1.21	1.35	1.41

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,330,383K ÷ ($2,327,080K – $660,091K)
= 0.80

The working capital turnover ratio for Enphase Energy Inc has shown fluctuations over the reported periods. From March 31, 2020, to March 31, 2024, the ratio ranged from 0.60 to 1.54, indicating changes in the efficiency of the company in utilizing its working capital to generate sales revenue. Lower ratios suggest a decrease in the effectiveness of utilizing working capital, while higher ratios indicate an improvement in efficiency.

Enphase Energy Inc experienced a notable drop in its working capital turnover from March 31, 2021 (0.60) to September 30, 2021 (0.90), before recovering to 1.35 by December 31, 2021. The ratio remained relatively stable around 1.38 from June 30, 2022, to December 31, 2023, before declining to 0.80 by the end of December 31, 2024.

It is essential for Enphase Energy Inc to closely monitor this ratio to ensure optimal utilization of its working capital, as a lower turnover ratio may indicate inefficiency or potential liquidity issues, while a higher ratio may suggest effective management of working capital. This metric provides insights into the company's operational efficiency and effectiveness in managing its short-term assets and liabilities.