KLA-Tencor Corporation (KLAC)
Liquidity ratios
| Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.62 | 2.54 | 2.36 | 2.13 | 2.09 | 2.08 | 1.91 | 2.21 | 2.24 | 2.35 | 2.34 | 2.43 | 2.50 | 2.33 | 2.41 | 2.44 | 2.71 | 2.66 | 2.59 | 2.72 |
| Quick ratio | 1.65 | 1.62 | 1.48 | 1.39 | 1.37 | 1.35 | 1.16 | 1.34 | 1.38 | 1.41 | 1.48 | 1.53 | 1.61 | 1.48 | 1.67 | 1.66 | 1.85 | 1.85 | 1.79 | 2.23 |
| Cash ratio | 1.10 | 1.03 | 0.91 | 0.96 | 0.97 | 0.96 | 0.73 | 0.88 | 0.87 | 0.85 | 0.82 | 0.94 | 0.94 | 0.91 | 1.01 | 1.04 | 1.19 | 1.20 | 1.14 | 1.64 |
The liquidity ratios of KLA-Tencor Corporation from September 2020 through June 2025 reveal a trend characterized by initial stability followed by gradual decline and subsequent partial recovery in recent periods.
The current ratio, which measures the company’s ability to cover short-term liabilities with its short-term assets, consistently remained above 2.0 over the analyzed period, indicating a generally robust liquidity position. Starting at 2.72 in September 2020, it experienced a slight downward trajectory, reaching a low of 1.91 in December 2023. Despite this decline, the ratio remained above the critical benchmark of 1.0, suggesting sufficient short-term asset coverage. Recent data shows a modest rebound, with the ratio increasing to 2.62 by June 2025.
The quick ratio, which excludes inventory from current assets to provide a more stringent measure of liquidity, followed a similar pattern. It began at 2.23 in September 2020, declining over time to a low of 1.16 in December 2023. This indicates that, excluding inventory, liquidity tightened notably during this period. However, subsequent quarters show an improvement, with the ratio rising to 1.65 by June 2025, reflecting enhanced liquidity in the most immediate assets.
The cash ratio, the most conservative liquidity measure focusing solely on cash and cash equivalents, displayed a declining trend until late 2023, when it dipped to 0.73. Yet, this ratio began to increase again, reaching 1.10 in June 2025. This suggests a stabilization and a strengthening of the firm’s readily available liquidity sources.
Overall, KLA-Tencor's liquidity ratios highlight a period of minor liquidity pressures commencing around late 2022, but the company managed to partially restore its liquidity position by mid-2025. The ratios indicate that while there were moments of tightening within the short-term liquidity spectrum, the company maintained overall capacity to meet its short-term obligations without significant strain throughout the analyzed timeframe.
See also:
Additional liquidity measure
| Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 279.49 | 293.30 | 300.15 | 317.74 | 323.73 | 316.64 | 323.05 | 297.10 | 284.12 | 268.26 | 257.08 | 253.08 | 249.42 | 236.27 | 246.73 | 240.50 | 236.06 | 234.51 | 264.83 | 232.02 |
The analysis of KLA-Tencor Corporation's cash conversion cycle (CCC) over the period from September 2020 to June 2025 reveals notable trends and fluctuations. The CCC measures the duration, in days, it takes for a company to convert its investments in inventory and other resources into cash flows from sales, encompassing the efficiency of the company's working capital management.
Initially, the CCC was approximately 232 days as of September 30, 2020. This figure increased gradually over time, reaching 264.83 days by December 31, 2020. The upward trajectory continued into 2021, with the cycle reaching around 240.50 days in September 2021 and peaking close to 246.73 days at year-end. The pattern persisted into 2022, with the CCC rising further to approximately 268.26 days by March 2023, indicating a lengthening of the operational cycle.
The most significant increase occurred between June 2023 and December 2023, where the CCC escalated from roughly 284.12 days to approximately 323.05 days, a substantial rise of about 39 days within six months. The trend persisted into early 2024, with the cycle slightly decreasing to 316.64 days in March 2024 and slightly increasing again to 323.73 days in June 2024.
In the subsequent quarters, there was a reduction from a high of approximately 317.74 days in September 2024 to around 293.30 days by March 2025, suggesting an improvement in working capital efficiency. However, the CCC remained relatively high compared to historical values, with levels still above 279 days in June 2025.
Overall, the data reflects a substantial lengthening of KLA-Tencor's cash conversion cycle over the period considered. The trend indicates increasing durations for converting inventory investments into cash, which could be attributed to factors such as extended inventory holding periods, slower receivables collections, or changes in supplier or sales terms. The recent partial reduction suggests some efforts toward operational efficiency, yet the cycle remains elevated relative to earlier years. This persistent elongation of the CCC warrants further investigation into underlying operational or strategic factors affecting receivables, inventory management, and payables.