Innoviva Inc (INVA)

Payables 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
Cost of revenue (ttm)	US$ in thousands	120,016	108,730	102,904	86,186	69,138	50,708	24,247	16,693	16,187	18,544	18,938	17,306	13,883	10,745	12,453	14,204	14,656	14,962	14,019	14,083
Payables	US$ in thousands	6,717	3,783	4,592	5,933	2,939	3,805	4,323	1,808	27	89	30	14	66	623	195	122	10	35	1,139	144
Payables turnover		17.87	28.74	22.41	14.53	23.52	13.33	5.61	9.23	599.52	208.36	631.27	1,236.14	210.35	17.25	63.86	116.43	1,465.60	427.49	12.31	97.80

December 31, 2023 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $120,016K ÷ $6,717K
= 17.87

Given the payables turnover data for Innoviva Inc from Q1 2022 to Q4 2023, we observe fluctuations in the efficiency of the company in managing its accounts payable.

The payables turnover ratio is calculated by dividing the total purchases made on credit by the average accounts payable during a specific period. A higher payables turnover ratio indicates that the company is paying off its suppliers more frequently and efficiently.

Innoviva's payables turnover ratio varied significantly over the past eight quarters, ranging from a low of 0.00 in Q2 2022 to a high of 10.47 in Q3 2023. The drastic increase in Q3 2023 suggests that the company significantly improved its ability to manage its payables compared to the past quarters.

When the payables turnover ratio is too low or zero, as observed in Q2 2022, it may indicate issues with managing accounts payable efficiently, potentially leading to strained supplier relationships or missed opportunities for utilizing their credit terms effectively.

However, the subsequent improvement in the ratio in the following quarters indicates that the company addressed these inefficiencies and enhanced its accounts payable management. The peak in Q3 2023 suggests that Innoviva may have negotiated better credit terms with suppliers or improved cash flow management, resulting in a higher turnover ratio.

Overall, the fluctuating trends in Innoviva's payables turnover ratio indicate varying levels of efficiency in managing its accounts payable over the analyzed period. Continued monitoring of this ratio will be essential to assess the company's progress in optimizing its payables management processes.