International Business Machines (IBM)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 27,560,000 | 27,842,000 | 25,865,000 | 24,314,000 | 26,181,000 |
| Payables | US$ in thousands | 4,132,000 | 4,051,000 | 3,955,000 | 4,033,000 | 4,896,000 |
| Payables turnover | 6.67 | 6.87 | 6.54 | 6.03 | 5.35 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $27,560,000K ÷ $4,132,000K
= 6.67
The payables turnover ratio of International Business Machines Corp. has shown a decreasing trend over the past five years. The ratio stood at 6.67 in 2023, down from 6.87 in 2022 and 6.54 in 2021. This suggests that the company took longer to pay its suppliers in 2023 compared to the previous two years.
In comparison to 2020 and 2019, where the payables turnover ratios were 7.75 and 8.30 respectively, the trend indicates a decline in the efficiency of managing the company's accounts payable. A decreasing payables turnover ratio may imply that IBM is taking more time to pay its suppliers, which could impact relationships with suppliers and potentially result in increased costs or strained supplier relationships.
Further analysis and investigation into the reasons behind the decreasing payables turnover ratio are required to determine whether this trend is a result of deliberate strategic decisions, changes in industry dynamics, or operational inefficiencies within IBM.
Peer comparison
Dec 31, 2023