Monolithic Power Systems Inc (MPWR)

Quick ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash	US$ in thousands	691,816	527,843	288,607	189,265	334,944
Short-term investments	US$ in thousands	171,130	580,633	449,266	535,817	260,169
Receivables	US$ in thousands	232,518	229,858	191,466	110,240	68,757
Total current liabilities	US$ in thousands	294,567	235,035	263,400	226,944	146,969
Quick ratio		3.72	5.69	3.53	3.68	4.52

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($691,816K + $171,130K + $232,518K) ÷ $294,567K
= 3.72

The quick ratio of Monolithic Power Systems Inc has shown a consistent level of liquidity over the past five years. It stood at 4.52 as of December 31, 2020, indicating strong short-term liquidity. Although there was a slight decrease in the quick ratio to 3.68 as of December 31, 2021, it remained above the threshold of 1, suggesting the company's ability to cover its current liabilities with its most liquid assets.

The quick ratio further decreased to 3.53 by December 31, 2022, which may indicate a minor reduction in short-term liquidity but still reflects a strong position overall. On December 31, 2023, the quick ratio significantly improved to 5.69, demonstrating a robust ability to meet short-term obligations without relying heavily on inventory.

As of December 31, 2024, the quick ratio slightly decreased to 3.72, maintaining a solid liquidity position. Overall, Monolithic Power Systems Inc has consistently exhibited a healthy quick ratio, indicating a strong ability to cover its short-term liabilities with readily available assets.