First Solar Inc (FSLR)

Receivables 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	3,318,599	3,162,439	2,990,282	2,800,564	2,619,318	2,524,247	2,478,818	2,487,043	2,923,377	2,625,290	2,969,351	2,982,582	2,711,332	3,501,480	3,120,721	3,063,266	3,063,120	2,354,981	2,484,395	2,208,757
Receivables	US$ in thousands	1,342,320	775,320	682,635	298,620	324,337	325,421	454,431	293,357	429,436	248,341	583,028	790,096	292,759	296,784	334,069	387,036	660,969	527,480	396,609	649,395
Receivables turnover		2.47	4.08	4.38	9.38	8.08	7.76	5.45	8.48	6.81	10.57	5.09	3.77	9.26	11.80	9.34	7.91	4.63	4.46	6.26	3.40

December 31, 2023 calculation

Receivables turnover = Revenue (ttm) ÷ Receivables
= $3,318,599K ÷ $1,342,320K
= 2.47

The receivables turnover ratio measures how efficiently a company is able to collect outstanding receivables from customers. It indicates the number of times a company collects its average accounts receivable balance during a period.

Analyzing the trend of First Solar Inc's receivables turnover based on the provided data, we observe fluctuations over the last eight quarters. The receivables turnover ratio ranged from a low of 2.39 in Q4 2023 to a high of 8.63 in Q1 2023.

A higher receivables turnover ratio suggests that a company is collecting its receivables more quickly, which is generally favorable as it indicates efficient management of accounts receivable. On the other hand, a lower ratio can indicate potential issues with collecting payments from customers promptly.

In this case, the sharp decline in the receivables turnover ratio in Q4 2023 compared to the previous quarters raises a red flag and warrants further investigation. It may imply a slowdown in the collection of outstanding receivables, which can impact the company's cash flow and liquidity.

Overall, monitoring and analyzing the receivables turnover ratio over time can provide insight into the effectiveness of First Solar Inc's credit and collection policies, as well as the company's overall financial health.