International Business Machines (IBM)
Receivables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 61,860,000 | 60,530,000 | 57,350,000 | 55,179,000 | 57,714,000 |
| Receivables | US$ in thousands | 7,725,000 | 14,209,000 | 14,977,000 | 18,738,000 | 23,795,000 |
| Receivables turnover | 8.01 | 4.26 | 3.83 | 2.94 | 2.43 |
December 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $61,860,000K ÷ $7,725,000K
= 8.01
The receivables turnover of International Business Machines Corp. has shown an improving trend over the past five years, indicating the company's ability to efficiently collect its accounts receivable. The ratio has increased from 3.24 in 2019 to 7.88 in 2023. This signifies that in 2023, the company converted its accounts receivable into cash almost 8 times during the year.
The upward trend in receivables turnover reflects that IBM has been more effective in managing its credit sales and collecting payments from customers promptly. A higher receivables turnover ratio generally suggests that a company has strong credit policies and efficient collection procedures in place. This bodes well for IBM's liquidity and overall financial health.
However, even though the trend shows improvement, it is important to note the fluctuations in the ratio over the years. For instance, there was a notable increase in 2022, followed by a slight decrease in 2023. It would be beneficial for investors and analysts to further investigate the reasons behind these fluctuations to gain a more nuanced understanding of IBM's receivables management performance.
Peer comparison
Dec 31, 2023