Microchip Technology Inc (MCHP)

Quick ratio

		Mar 31, 2025	Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Cash	US$ in thousands	771,700	319,700	234,000	317,400	280,000
Short-term investments	US$ in thousands	—	639,400	0	2,000	2,000
Receivables	US$ in thousands	689,700	1,143,700	1,305,300	1,072,600	997,700
Total current liabilities	US$ in thousands	1,155,100	2,519,400	3,118,600	1,399,000	2,409,600
Quick ratio		1.27	0.83	0.49	0.99	0.53

March 31, 2025 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($771,700K + $—K + $689,700K) ÷ $1,155,100K
= 1.27

The quick ratio of Microchip Technology Inc has shown varying trends over the past five years. As of March 31, 2021, the quick ratio was relatively low at 0.53 indicating a potential liquidity concern. However, by March 31, 2022, the ratio improved significantly to 0.99, nearing the desired benchmark of 1, suggesting a better ability to cover its short-term liabilities with liquid assets.

In the subsequent years, the quick ratio fluctuated: decreasing to 0.49 by March 31, 2023, possibly indicating a temporary liquidity strain, then increasing to 0.83 by March 31, 2024, showing some improvement in liquidity position.

The most recent data point on March 31, 2025, reveals a quick ratio of 1.27, surpassing the ideal threshold of 1. This implies that Microchip Technology Inc has a strong capacity to meet its short-term obligations with its readily available assets.

Overall, the trend in the quick ratio of Microchip Technology Inc indicates some variability in liquidity levels over the years, with recent improvements suggesting a more solid financial footing.