First Solar Inc (FSLR)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 3,318,600 | 2,619,320 | 2,923,380 | 2,711,330 | 3,063,120 |
| Total current assets | US$ in thousands | 4,634,810 | 3,791,420 | 3,191,240 | 3,014,540 | 3,599,830 |
| Total current liabilities | US$ in thousands | 1,306,160 | 1,038,050 | 726,878 | 847,398 | 1,318,210 |
| Working capital turnover | 1.00 | 0.95 | 1.19 | 1.25 | 1.34 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $3,318,600K ÷ ($4,634,810K – $1,306,160K)
= 1.00
The working capital turnover of First Solar Inc has been fluctuating over the past five years. A working capital turnover ratio of 1.00 in 2023 indicates that the company generated $1 of revenue for every $1 of working capital invested during the year.
Comparing this to the previous year, where the ratio was 0.95, we observe a modest improvement in the efficiency of utilizing working capital to generate revenue. However, this ratio is lower than the ratios for 2021, 2020, and 2019, suggesting a potential decline in efficiency in utilizing working capital during the most recent year.
The decreasing trend in working capital turnover from 1.34 in 2019 to 1.00 in 2023 may indicate that the company is becoming less efficient in utilizing its working capital to generate revenue over time. This trend should be further investigated to identify the factors contributing to this decline and assess the overall effectiveness of the company's working capital management.
Peer comparison
Dec 31, 2023