Meta Platforms Inc. (META)
Current ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 100,045,000 | 85,365,000 | 59,549,000 | 66,666,000 | 75,670,000 |
| Total current liabilities | US$ in thousands | 33,596,000 | 31,960,000 | 27,026,000 | 21,135,000 | 14,981,000 |
| Current ratio | 2.98 | 2.67 | 2.20 | 3.15 | 5.05 |
December 31, 2024 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $100,045,000K ÷ $33,596,000K
= 2.98
The current ratio of Meta Platforms Inc. has experienced a declining trend over the past five years. As of December 31, 2020, the current ratio stood at 5.05, indicating a strong liquidity position with significant current assets to cover current liabilities. However, this ratio decreased to 3.15 by December 31, 2021, and further dropped to 2.20 by December 31, 2022. This decline suggests a reduction in the company's ability to meet its short-term obligations using current assets.
Although there was a slight improvement in the current ratio to 2.67 by December 31, 2023, it remained below the levels seen in the earlier years. By December 31, 2024, the current ratio increased to 2.98, showing a further recovery but still indicates a lower liquidity position compared to the initial year.
Overall, the decreasing trend in the current ratio of Meta Platforms Inc. from 2020 to 2022 followed by a modest recovery in the subsequent years raises concerns about the company's short-term liquidity management and ability to meet its current obligations comfortably. Monitoring this ratio closely is essential to assess the company's liquidity health accurately.
Peer comparison
Dec 31, 2024