Fair Isaac Corporation (FICO)

Working capital turnover

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Revenue	US$ in thousands	1,417,230	1,310,010	1,376,250	1,294,560	1,160,080
Total current assets	US$ in thousands	556,448	484,715	550,974	534,078	455,706
Total current liabilities	US$ in thousands	367,688	331,459	559,207	414,511	490,828
Working capital turnover		7.51	8.55	—	10.83	—

September 30, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,417,230K ÷ ($556,448K – $367,688K)
= 7.51

The working capital turnover ratio measures the efficiency in which a company utilizes its working capital to generate sales. It is calculated by dividing the net sales by the average working capital, where the average working capital is the sum of working capital at the beginning and end of the year divided by 2.

Based on the provided data, the working capital turnover for Fair, Isaac Corp. has been 8.02 in 2023 and 8.99 in 2022. Although the specific working capital figures are not available, the decreasing trend in the working capital turnover ratio suggests that the company may be less efficient in utilizing its working capital to generate sales in 2023 compared to 2022.

However, it's important to note that the absence of data for 2021, 2020, and 2019 makes it difficult to establish a trend over the complete period. In 2022 and 2023, the working capital turnover is higher than in prior years, indicating an improvement in efficiency in utilizing working capital to generate sales.

This ratio is a key metric as it reflects the company's ability to generate sales from its working capital, which is crucial for maintaining healthy cash flows and liquidity. Any significant changes in this ratio should be further analyzed to understand the underlying reasons and their potential impact on the company's financial performance and position.