Fortinet Inc (FTNT)

Working capital 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	5,240,800	5,073,600	4,894,300	4,628,200	4,328,000	4,044,600	3,755,900	3,535,000	3,309,700	3,108,300	2,900,500	2,719,400	2,586,000	2,453,200	2,349,600	2,255,800	2,151,500	2,040,600	1,947,000	1,866,600
Total current assets	US$ in thousands	4,428,300	4,752,700	4,878,100	4,358,700	3,810,400	2,982,200	2,952,900	3,208,300	3,600,600	3,963,500	3,908,200	3,781,200	2,740,400	2,384,600	2,208,700	2,035,300	2,769,000	2,466,200	2,360,700	2,313,300
Total current liabilities	US$ in thousands	3,719,000	3,649,000	3,500,600	3,261,800	3,078,400	2,779,600	2,634,900	2,510,500	2,318,100	2,198,000	1,998,500	1,879,700	1,829,500	1,645,600	1,611,900	1,543,000	1,455,800	1,341,900	1,293,700	1,254,300
Working capital turnover		7.39	4.60	3.55	4.22	5.91	19.96	11.81	5.07	2.58	1.76	1.52	1.43	2.84	3.32	3.94	4.58	1.64	1.81	1.82	1.76

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $5,240,800K ÷ ($4,428,300K – $3,719,000K)
= 7.39

The working capital turnover ratio measures how effectively a company is utilizing its working capital to generate sales revenue. A higher turnover ratio generally indicates more efficient utilization of working capital.

Looking at Fortinet Inc's working capital turnover ratios over the past eight quarters, we observe fluctuations in the ratio. In Q4 2023, the working capital turnover was 7.48, which was significantly higher compared to the previous quarter but lower than Q3 2022 and Q2 2022. This suggests that in Q4 2023, Fortinet Inc was able to generate $7.48 in revenue for every dollar of working capital invested.

The significant increase in turnover from Q3 2023 to Q4 2023 may indicate improved efficiency in managing working capital, possibly through more effective inventory management or accounts receivable collection practices. However, a long-term trend should be monitored to assess the sustainability of this performance.

Overall, while the working capital turnover ratio can provide insights into the company's operational efficiency and liquidity management, it should be analyzed in conjunction with other financial ratios and qualitative factors to get a comprehensive understanding of Fortinet Inc's financial performance.