KLA-Tencor Corporation (KLAC)

Activity ratios

Short-term

Turnover ratios

	Jun 30, 2024	Mar 31, 2024	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
Inventory turnover	1.29	1.29	1.28	1.37	1.47	1.54	1.63	1.59	1.67	1.71	1.75	1.73	1.76	1.81	1.76	1.77	1.87	1.91	1.85	1.67
Receivables turnover	5.34	5.68	5.05	6.02	5.80	5.34	4.50	5.21	4.99	5.26	4.67	5.06	5.30	5.36	4.98	5.76	5.23	5.01	4.43	4.58
Payables turnover	10.93	10.94	10.33	11.34	11.37	10.30	7.77	7.96	8.10	7.98	8.43	7.79	8.10	8.88	9.53	9.69	9.27	9.95	9.03	9.45
Working capital turnover	1.82	1.82	2.23	2.13	2.20	2.26	2.21	2.15	2.11	2.27	2.06	2.05	1.93	1.91	1.90	1.97	1.92	2.10	1.99	2.03

KLA-Tencor Corporation's inventory turnover ratio has been relatively stable over the past several quarters, ranging from 1.29 to 1.91 times. This indicates that the company is managing its inventory efficiently, with the ability to sell and replace its stock of goods within a reasonable time frame.

The receivables turnover ratio has shown some fluctuations but generally remains within a range of 4.43 to 6.02 times. This suggests that KLA-Tencor is collecting its receivables at a moderate to satisfactory pace, with the ability to convert its outstanding sales into cash.

On the other hand, the payables turnover ratio has also been consistent, falling in the range of 7.77 to 11.37 times. This indicates that the company is managing its payables effectively, potentially taking advantage of trade credit terms to support its operations.

The working capital turnover ratio has varied but generally hovers around 1.82 to 2.27 times. This suggests that KLA-Tencor efficiently utilizes its working capital to generate sales revenue, indicating operational efficiency in utilizing its current assets and liabilities.

Overall, KLA-Tencor Corporation appears to be effectively managing its activity ratios, demonstrating operational efficiency in managing its inventory, receivables, payables, and working capital.

Average number of days

		Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	281.99	282.85	284.97	266.20	248.92	237.05	224.58	230.11	218.13	213.68	208.43	211.15	207.42	201.97	207.24	206.37	195.34	190.60	197.08	218.81
Days of sales outstanding (DSO)	days	68.32	64.26	72.24	60.59	62.88	68.38	81.14	70.06	73.13	69.37	78.17	72.17	68.93	68.06	73.34	63.40	69.76	72.88	82.44	79.73
Number of days of payables	days	33.40	33.37	35.33	32.19	32.10	35.42	46.98	45.84	45.04	45.72	43.28	46.88	45.04	41.09	38.29	37.66	39.38	36.67	40.42	38.62

The Days of Inventory on Hand (DOH) for KLA-Tencor Corporation have shown an increasing trend over the past six quarters, indicating that the company is taking longer to sell its inventory. This can potentially signal inefficiencies in inventory management and could lead to higher carrying costs and potential obsolescence risks.

On the other hand, the Days of Sales Outstanding (DSO) have fluctuated over the same period, but generally have remained within a moderate range. A decreasing trend in DSO would be preferable as it would indicate that the company is collecting receivables more quickly, improving cash flow and reducing the risk of bad debts.

The Number of Days of Payables have also varied but generally remained stable over the past quarters. A higher number of days of payables suggests that the company is taking longer to pay its suppliers, which can be beneficial for cash flow management but might strain relationships with suppliers in the long run.

Overall, KLA-Tencor Corporation may need to focus on improving its inventory management practices to reduce the number of days inventory is held, while also aiming to reduce DSO to improve cash flow. Additionally, the company should monitor its payables closely to maintain healthy supplier relationships while managing cash effectively.

Long-term

	Jun 30, 2024	Mar 31, 2024	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
Fixed asset turnover	8.82	8.35	8.56	9.27	9.86	10.57	10.66	10.61	10.65	10.54	11.26	10.61	10.44	10.27	10.22	10.56	11.17	11.26	10.77	10.29
Total asset turnover	0.63	0.62	0.65	0.69	0.72	0.76	0.75	0.74	0.72	0.71	0.69	0.66	0.67	0.65	0.62	0.64	0.63	0.63	0.57	0.53

Based on the provided long-term activity ratios for KLA-Tencor Corporation, we can observe the following trends:

1. Fixed Asset Turnover:
- The fixed asset turnover ratio has been consistently high, indicating that the company efficiently generates sales from its fixed assets.
- The ratio ranged between 8.35 and 11.26 over the past several quarters, showing a relatively stable performance in utilizing its fixed assets.
- The company's ability to generate revenue from its investments in property, plant, and equipment has remained strong and consistent over the analyzed periods.

2. Total Asset Turnover:
- The total asset turnover ratio has fluctuated between 0.53 and 0.76, demonstrating variations in the company's overall efficiency in generating sales from its total assets.
- While the ratio has shown some volatility, it has generally remained within a moderate range.
- The lower total asset turnover compared to fixed asset turnover suggests that the company may have a significant proportion of non-operating or non-productive assets on its balance sheet.

Overall, the analysis of KLA-Tencor Corporation's long-term activity ratios indicates a strong and consistent performance in efficiently utilizing fixed assets to generate revenue. However, the company's overall efficiency in generating sales from its total assets may benefit from further scrutiny and potential optimization to enhance profitability.