Alphabet Inc Class A (GOOGL)

Activity ratios

Short-term

Turnover ratios

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
Inventory turnover — 44.34 57.83 54.95 47.27 39.24 60.76 85.05 94.82 81.40 107.53 101.19 116.39 95.42 93.40 84.21 71.97 49.10 67.95 58.97
Receivables turnover 6.37 7.18 7.42 7.86 6.99 7.81 7.50 7.58 6.39 6.85 6.68 6.87 5.79 6.71 7.67 7.01 5.87 7.36 6.96 7.37
Payables turnover 17.79 22.59 24.29 30.41 24.61 19.65 27.29 33.89 18.38 22.54 20.72 18.72 15.16 18.14 18.73 18.26 12.93 16.61 16.69 16.74
Working capital turnover 3.40 3.27 3.16 3.04 2.95 2.82 2.50 2.33 2.08 1.95 1.83 1.68 1.55 1.47 1.57 1.56 1.50 1.42 1.34 1.37

The activity ratios of Alphabet Inc provide insights into the efficiency and effectiveness of the company's management of its inventory, receivables, payables, and working capital.

The inventory turnover ratio, which measures how effectively the company manages its inventory by generating sales from it, experienced fluctuations during the period. The ratio increased steadily from 39.24 at the end of September 2022 to 60.76 at the end of June 2022, before declining to 44.34 at the end of September 2023. This indicates that the company might have managed its inventory more efficiently in the first half of 2022 but experienced a decline in efficiency in the subsequent periods.

The receivables turnover ratio, reflecting the speed at which the company collects its receivables from customers, remained relatively stable throughout the period. Although there were minor fluctuations, the ratio remained within a narrow range, suggesting consistent management of receivables.

The payables turnover ratio, which evaluates how efficiently the company pays its suppliers, displayed variability, reaching the highest value of 33.89 at the end of March 2022, before decreasing to 17.79 at the end of December 2023. This indicates that the company might have extended its payable period in the later periods, possibly affecting its relationships with suppliers.

The working capital turnover ratio, highlighting the company's ability to generate sales from its working capital, showed an increasing trend over the period, indicating improved efficiency in utilizing the working capital to generate revenue.

Overall, the activity ratios suggest that Alphabet Inc exhibited fluctuations in inventory and payables turnover, while maintaining relatively stable receivables turnover and improving working capital turnover. These fluctuations may signify varying efficiency in managing inventory and payables, which could impact the company's liquidity and supplier relationships.

Average number of days

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
Days of inventory on hand (DOH) days — 8.23 6.31 6.64 7.72 9.30 6.01 4.29 3.85 4.48 3.39 3.61 3.14 3.83 3.91 4.33 5.07 7.43 5.37 6.19
Days of sales outstanding (DSO) days 57.32 50.81 49.22 46.45 52.20 46.76 48.70 48.15 57.13 53.32 54.64 53.11 63.04 54.41 47.62 52.10 62.15 49.59 52.43 49.50
Number of days of payables days 20.51 16.16 15.03 12.00 14.83 18.58 13.38 10.77 19.86 16.20 17.62 19.50 24.08 20.12 19.49 19.98 28.23 21.98 21.87 21.81

Days of inventory on hand (DOH) measures how efficiently Alphabet Inc is managing its inventory. In the last quarter of 2023, the company improved its inventory management as the days of inventory on hand decreased to 6.31 days from 8.23 days in the previous quarter. This indicates that the company was able to sell its inventory at a faster rate, which is a positive sign for the company's operations.

Days of sales outstanding (DSO) indicates how long it takes for the company to collect its accounts receivable. The trend shows a slight improvement in the company's collection period in the last quarter of 2023, with DSO decreasing to 48.92 days from 56.95 days in the previous quarter. This suggests that Alphabet Inc was able to collect its receivables more efficiently, thereby converting sales into cash more quickly.

Number of days of payables measures the average number of days Alphabet Inc takes to pay its suppliers. In the last quarter of 2023, the company extended its payment period to 15.03 days from 16.15 days in the previous quarter. This suggests that the company has been able to manage its payables more effectively, allowing it to hold onto cash for a longer period.

In summary, Alphabet Inc has shown improvement in its inventory management and efficient collection of receivables, while also effectively managing its payables. These trends indicate that the company is operating its working capital more efficiently, which can positively impact its overall financial performance.

Long-term

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
Fixed asset turnover 2.27 2.34 2.37 2.41 2.50 2.61 2.62 2.59 2.64 2.52 2.39 2.24 2.14 2.10 2.10 1.89 2.19 2.24 2.29 2.35
Total asset turnover 0.76 0.74 0.75 0.77 0.77 0.79 0.78 0.76 0.72 0.69 0.65 0.60 0.57 0.57 0.59 0.61 0.59 0.59 0.58 0.58

The fixed asset turnover ratio for Alphabet Inc has been relatively stable over the past eight quarters, ranging from 2.29 to 2.62. This indicates that the company is generating between 2.29 to 2.62 dollars in revenue for every dollar invested in fixed assets. The consistency of this ratio suggests efficient utilization of fixed assets to generate sales.

The total asset turnover ratio has also remained relatively steady, ranging from 0.75 to 0.79 over the same period. This indicates that Alphabet Inc is generating between 0.75 to 0.79 dollars in sales for every dollar invested in total assets. The consistent performance of this ratio suggests that the company is effectively utilizing its total assets to generate revenue.

Overall, both the fixed asset turnover and total asset turnover ratios reflect stable and efficient long-term asset utilization by Alphabet Inc during the analyzed period.