Meta Platforms Inc. (META)

Activity ratios

Short-term

Turnover ratios

	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	Jun 30, 2020	Mar 31, 2020
Inventory turnover	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Receivables turnover	9.64	10.59	10.28	10.57	8.29	9.77	9.60	10.60	8.64	10.51	10.35	10.49	8.39	9.28	8.95	9.17	7.57	9.83	10.03	10.05
Payables turnover	3.92	3.79	8.78	7.00	4.54	5.17	6.75	5.56	4.13	4.80	4.67	5.63	4.41	6.93	10.37	9.75	12.54	13.54	15.15	16.18
Working capital turnover	2.47	2.70	3.02	3.01	2.51	2.64	3.03	4.32	3.58	3.31	3.53	3.13	2.59	1.95	1.59	1.46	1.41	1.46	1.32	1.35

Analysis of Meta Platforms Inc. Activity Ratios

1. Receivables Turnover:
- Meta Platforms Inc. has shown a consistent trend of receivables turnover over the years.
- The receivables turnover ratio indicates that the company collects its receivables approximately 8 to 10 times a year.
- Higher turnover ratios suggest efficient management in collecting accounts receivables.

2. Payables Turnover:
- Meta Platforms Inc. has displayed fluctuations in payables turnover.
- The payables turnover ratio indicates the number of times a company pays off its accounts payable during the period.
- A lower turnover ratio may indicate that the company takes longer to pay its suppliers.

3. Working Capital Turnover:
- The working capital turnover ratio has generally shown an increasing trend.
- The ratio measures the efficiency of utilizing working capital to generate sales.
- Higher turnover ratios imply better efficiency in using the company's working capital to support revenue-generating activities.

In conclusion, Meta Platforms Inc. has demonstrated effective management of receivables turnover and working capital turnover, indicating efficiency in collecting receivables and utilizing working capital. However, fluctuations in payables turnover may suggest inconsistencies in the company's payment schedules to suppliers. Monitoring and optimizing activity ratios can help improve operational efficiency and working capital management for Meta Platforms Inc.

Average number of days

		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	Jun 30, 2020	Mar 31, 2020
Days of inventory on hand (DOH)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	37.87	34.46	35.50	34.53	44.01	37.38	38.02	34.44	42.24	34.74	35.27	34.79	43.51	39.33	40.80	39.79	48.21	37.14	36.40	36.33
Number of days of payables	days	93.02	96.30	41.58	52.15	80.32	70.56	54.04	65.61	88.28	76.04	78.12	64.88	82.75	52.67	35.19	37.45	29.10	26.96	24.10	22.56

The activity ratios for Meta Platforms Inc. provide insights into how efficiently the company manages its inventory, collects its receivables, and pays its payables.

1. Days of Inventory on Hand (DOH): The data provided does not include specific values for the days of inventory on hand, which could indicate that Meta Platforms Inc. operates with a just-in-time inventory system or possesses highly liquid inventory that can be quickly sold. It may also suggest that inventory turnover is high, as goods are moving out of inventory rapidly.

2. Days of Sales Outstanding (DSO): The DSO for Meta Platforms Inc. ranged from around 34 to 44 days over the analyzed period. A lower DSO indicates that the company collects its receivables more quickly, which is generally positive as it indicates strong cash flow and efficient credit management.

3. Number of Days of Payables: The number of days of payables for Meta Platforms Inc. ranged from approximately 22 to 96 days. A higher number of days of payables could suggest that the company takes longer to pay its suppliers, potentially indicating a more favorable position for Meta Platforms in terms of working capital management.

Overall, analyzing these activity ratios together can provide a more holistic view of how Meta Platforms Inc. manages its assets and liabilities to sustain its operational efficiency and liquidity levels.

Long-term

	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	Jun 30, 2020	Mar 31, 2020
Fixed asset turnover	1.35	1.39	1.45	1.44	1.39	1.38	1.37	1.39	1.46	1.60	1.76	1.94	2.04	2.09	2.06	1.98	1.88	1.86	1.92	1.97
Total asset turnover	0.59	0.61	0.65	0.64	0.58	0.58	0.58	0.63	0.63	0.66	0.70	0.73	0.71	0.66	0.61	0.58	0.54	0.54	0.54	0.53

The fixed asset turnover ratio measures how efficiently a company is utilizing its fixed assets to generate revenue. Meta Platforms Inc.'s fixed asset turnover ratio has shown a declining trend over the past few years, starting at 1.97 in March 2020 and gradually decreasing to 1.35 by December 2024. This indicates that the company is generating less revenue per dollar of fixed assets invested over time, which could be a concerning trend.

On the other hand, the total asset turnover ratio reflects how effectively a company is using all its assets to generate sales. Meta Platforms Inc.'s total asset turnover ratio has generally increased from 0.53 in March 2020 to 0.59 by December 2024, with fluctuations along the way. This suggests that the company is becoming more efficient in generating sales relative to its total assets.

Overall, while the total asset turnover ratio shows an improving trend, the declining trend in the fixed asset turnover ratio raises concerns about the efficiency of Meta Platforms Inc.'s fixed asset utilization for revenue generation. Further analysis and context are needed to understand the factors driving these trends and their implications for the company's operations and financial performance.