F5 Networks Inc (FFIV)

Working capital turnover

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Revenue	US$ in thousands	2,827,870	2,717,440	2,616,420	2,361,020	2,242,450
Total current assets	US$ in thousands	1,848,770	1,912,220	1,611,100	1,793,480	1,511,590
Total current liabilities	US$ in thousands	1,472,780	1,839,950	1,391,530	1,288,280	1,105,530
Working capital turnover		7.52	37.60	11.92	4.67	5.52

September 30, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,827,870K ÷ ($1,848,770K – $1,472,780K)
= 7.52

The working capital turnover ratio measures the efficiency of a company in utilizing its working capital to generate sales revenue. A higher ratio indicates better efficiency in utilizing working capital.

Looking at F5 Inc's working capital turnover over the past five years, we observe the following trends:

- In 2023, the working capital turnover ratio was 7.48, a significant decrease from the previous year. This decrease could be attributed to a decrease in sales relative to the working capital employed, indicating a potential decrease in efficiency or an increase in the amount of working capital required to support sales.

- In 2022, the working capital turnover ratio was remarkably high at 37.30, indicating a very efficient use of working capital to generate sales revenue. This may suggest that the company was able to generate a significant amount of sales relative to the working capital employed.

- In 2021, the working capital turnover ratio was 11.86, also showing an efficient use of working capital to generate sales revenue, albeit lower than in 2022.

- In 2020, the ratio was 4.65, indicating a decline in efficiency relative to the previous year. This may suggest that the company was less effective in utilizing its working capital to generate sales revenue.

- In 2019, the working capital turnover ratio was 5.52, showing a moderate level of efficiency in utilizing working capital to generate sales revenue.

Overall, the fluctuation in F5 Inc's working capital turnover over the years highlights variations in the company's efficiency in utilizing its working capital. It is essential for the company to analyze the underlying factors contributing to these fluctuations and take appropriate measures to improve working capital management and efficiency in generating sales revenue.