F5 Networks Inc (FFIV)

Working capital turnover

		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	Dec 31, 2019
Revenue (ttm)	US$ in thousands	2,827,520	2,787,720	2,794,867	2,816,688	2,830,769	2,832,628	2,804,474	2,735,523	2,720,645	2,701,609	2,678,636	2,689,699	2,618,816	2,545,335	2,477,072	2,415,234	2,356,422	2,331,994	2,312,136	2,273,582
Total current assets	US$ in thousands	2,109,470	1,986,170	1,951,520	1,961,750	1,848,770	1,713,780	1,825,180	1,714,510	1,912,220	1,688,920	1,734,830	1,687,970	1,611,100	1,466,710	1,335,650	2,029,810	1,793,480	1,665,430	1,408,730	1,737,470
Total current liabilities	US$ in thousands	1,489,650	1,455,580	1,502,420	1,524,460	1,472,780	1,489,540	1,525,600	1,533,480	1,839,950	1,768,700	1,773,230	1,431,890	1,391,530	1,354,960	1,327,100	1,319,250	1,288,280	1,263,320	1,252,010	1,150,510
Working capital turnover		4.56	5.25	6.22	6.44	7.53	12.63	9.36	15.11	37.65	—	—	10.50	11.93	22.78	289.72	3.40	4.66	5.80	14.75	3.87

September 30, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $2,827,520K ÷ ($2,109,470K – $1,489,650K)
= 4.56

The working capital turnover ratio measures how efficiently a company manages its working capital to generate sales revenue. A higher working capital turnover indicates that the company is more efficient in using its current assets to generate sales.

Analyzing the data for F5 Networks Inc, we observe fluctuations in the working capital turnover ratio over the periods provided. The ratio ranged from 3.40 to 289.72, with significant variations indicating fluctuations in the company's working capital management efficiency.

The trend shows that F5 Networks Inc experienced a substantial increase in working capital turnover from 2019 to 2023, with the ratio peaking at 289.72 in the first quarter of 2021. This surge suggests significant improvement in the company's ability to generate sales relative to its working capital during that period.

However, in subsequent quarters, the working capital turnover ratio declined, indicating a decrease in efficiency in utilizing working capital to generate sales. The ratio dropped to 4.56 in the most recent quarter, signaling a potential need for the company to reassess its working capital management strategies.

Overall, while F5 Networks Inc demonstrated periods of exceptionally high efficiency in working capital turnover, the varying ratios highlight a degree of inconsistency in managing working capital to drive sales revenue. It may be crucial for the company to maintain a balance between efficient working capital utilization and sustainable growth in the future.