Fortinet Inc (FTNT)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	5,955,800	5,304,800	4,417,400	3,342,200	2,594,400
Total current assets	US$ in thousands	5,971,500	4,428,300	3,810,400	3,600,600	2,740,400
Total current liabilities	US$ in thousands	4,060,700	3,719,000	3,078,400	2,318,100	1,829,500
Working capital turnover		3.12	7.48	6.03	2.61	2.85

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $5,955,800K ÷ ($5,971,500K – $4,060,700K)
= 3.12

The working capital turnover ratio for Fortinet Inc has shown fluctuating trends over the past five years. In 2020, the ratio was 2.85, indicating that the company generated $2.85 in revenue for every dollar of working capital invested. However, in 2021, the ratio slightly decreased to 2.61, which may suggest a decrease in efficiency in utilizing working capital to generate revenue.

A significant improvement was observed in 2022, where the ratio surged to 6.03, indicating that the company significantly improved its efficiency in generating revenue from working capital. This improvement continued in 2023, with the ratio reaching 7.48, reflecting a further increase in efficiency and effectiveness in utilizing working capital.

However, in 2024, the ratio dropped to 3.12, which could be a cause for concern as it signifies a reduction in the company's ability to generate revenue relative to its working capital investment compared to the previous year. Overall, the working capital turnover ratio of Fortinet Inc has shown variability, highlighting the importance of closely monitoring and managing working capital efficiency to support sustainable growth and profitability.