Godaddy Inc (GDDY)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	2,686,700	2,668,300	2,564,200	2,294,300	2,063,700
Payables	US$ in thousands	148,100	130,900	85,200	51,000	72,300
Payables turnover		18.14	20.38	30.10	44.99	28.54

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $2,686,700K ÷ $148,100K
= 18.14

Payables turnover measures how effectively a company manages its accounts payable by evaluating how many times a company pays off its suppliers in a given period. A higher payables turnover ratio indicates that the company is paying its suppliers more frequently.

Analyzing Godaddy Inc's payables turnover over the past five years, we observe a declining trend from 2019 to 2023. In 2019, the payables turnover ratio was 14.20, indicating that the company paid its suppliers approximately 14 times throughout the year. The ratio increased significantly to 22.72 in 2020, suggesting a more rapid payment cycle that year.

However, in the subsequent years, the payables turnover ratio decreased, reaching 16.11 in 2021, 11.34 in 2022, and 10.63 in 2023. This downward trend may imply a slower payment cycle in recent years, meaning Godaddy Inc is taking more time to pay off its suppliers.

A decreasing payables turnover ratio could indicate a delay in payments to suppliers, strained supplier relationships, or potential cash flow issues within the company. It is essential for companies to strike a balance in managing their payables turnover to maintain healthy relationships with suppliers while ensuring efficient cash flow management. Further analysis and consideration of other financial metrics are recommended to gain a comprehensive understanding of Godaddy Inc's financial performance and supplier management practices.