Fair Isaac Corporation (FICO)

Fixed asset turnover

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Revenue (ttm)	US$ in thousands	1,451,275	1,415,832	1,382,391	1,338,493	1,322,108	1,310,169	1,304,205	1,394,931	1,376,365	1,376,295	1,426,790	1,319,550	1,306,103	1,294,562	1,225,550	1,226,068	1,196,331	1,160,083	1,111,271	1,052,015
Property, plant and equipment	US$ in thousands	10,406	10,966	11,799	13,664	14,976	17,580	20,449	22,897	24,597	27,913	31,565	34,897	39,011	46,419	50,526	146,633	144,631	53,027	52,900	44,760
Fixed asset turnover		139.47	129.11	117.16	97.96	88.28	74.53	63.78	60.92	55.96	49.31	45.20	37.81	33.48	27.89	24.26	8.36	8.27	21.88	21.01	23.50

December 31, 2023 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $1,451,275K ÷ $10,406K
= 139.47

The fixed asset turnover ratio measures how effectively a company utilizes its fixed assets to generate sales. It is calculated by dividing net sales by average fixed assets. Higher ratios indicate more efficient utilization of fixed assets.

Fair, Isaac Corp.'s fixed asset turnover has been steadily increasing over the past eight quarters, reaching a high of 149.02 at the end of December 2023. This indicates that the company is generating more revenue relative to its investment in fixed assets. The significant improvement in the ratio suggests that Fair, Isaac Corp. has been able to optimize the use of its fixed assets to generate sales, potentially leading to improved profitability and return on investment.

The company's ability to generate a high level of sales relative to its investment in fixed assets in recent quarters is a positive indicator of management's ability to efficiently utilize its asset base. This trend may be a result of operational improvements, cost-saving initiatives, or effective capital allocation strategies. It also suggests that the company may be effectively managing its capital expenditures and maintaining an optimal level of fixed assets to support its sales growth.

However, it's important to note that while a high fixed asset turnover ratio is generally favorable, exceptionally high ratios may also indicate that the company is not investing enough in its fixed assets, which could lead to underutilization or inefficiencies in production. Therefore, it's essential to consider this ratio in conjunction with other performance metrics and industry benchmarks to gain a holistic understanding of Fair, Isaac Corp.'s operational efficiency and asset management.