Extreme Networks Inc (EXTR)

Payables turnover

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Cost of revenue	US$ in thousands	971,985	987,475	855,845	777,428	816,590
Payables	US$ in thousands	51,423	99,724	84,338	60,142	48,439
Payables turnover		18.90	9.90	10.15	12.93	16.86

June 30, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $971,985K ÷ $51,423K
= 18.90

The payables turnover ratio for Extreme Networks Inc has fluctuated over the past five years. The ratio was 18.90 in 2024, indicating that the company paid its accounts payable almost 19 times during the year. This may suggest that the company is managing its accounts payable efficiently by settling its obligations quickly.

In comparison, the payables turnover ratio was 9.90 in 2023, 10.15 in 2022, 12.93 in 2021, and 16.86 in 2020. These figures show some variability in how quickly the company paid its suppliers over the years, with a notable increase in 2024 compared to the prior years.

It is essential to consider the industry norms and company's specific circumstances when interpreting the payables turnover ratio. A higher ratio may indicate effective management of payables and good relationships with suppliers. However, an excessively high ratio could also signal possible cash flow issues or a risk of strained relationships with suppliers due to overly aggressive payment practices.