ServiceNow Inc (NOW)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,287,000 | 1,921,000 | 1,573,000 | 1,353,000 | 987,000 |
| Payables | US$ in thousands | 68,000 | 126,000 | 274,000 | 89,000 | 34,000 |
| Payables turnover | 33.63 | 15.25 | 5.74 | 15.20 | 29.03 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $2,287,000K ÷ $68,000K
= 33.63
The payables turnover ratio for ServiceNow Inc has exhibited fluctuations over the years. In 2020, the ratio was 29.03, indicating that the company was able to pay off its suppliers approximately 29 times during that year. However, there was a significant decrease in 2022, with the ratio dropping to 5.74, suggesting a slower rate of paying off payables compared to the previous year.
By 2024, the payables turnover ratio had rebounded to 33.63, surpassing even the 2020 level, signifying a more efficient management of payables during this period. The variations in the payables turnover ratio reflect changes in the company's payment practices and relationships with suppliers over the years. It is essential for ServiceNow Inc to monitor and manage this metric effectively to ensure optimal working capital management and maintain healthy supplier relationships.
Peer comparison
Dec 31, 2024