NVIDIA Corporation (NVDA)

Fixed asset turnover

		Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Revenue	US$ in thousands	60,922,000	26,974,000	26,914,000	16,675,000	10,918,000
Property, plant and equipment	US$ in thousands	3,914,000	3,807,000	2,778,000	2,149,000	1,674,000
Fixed asset turnover		15.57	7.09	9.69	7.76	6.52

January 28, 2024 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $60,922,000K ÷ $3,914,000K
= 15.57

The fixed asset turnover ratio for NVIDIA Corp has shown an increasing trend over the past five years. The ratio was 6.52 in January 2020, which indicates that for every dollar of fixed assets that NVIDIA had, it generated $6.52 in revenue. This ratio increased to 7.76 in January 2021, 9.69 in January 2022, and further to 7.09 in January 2023. The most recent ratio recorded in January 2024 was 15.57, which suggests that there was a significant improvement in the company's efficiency in generating revenue from its fixed assets.

The upward trend in the fixed asset turnover ratio indicates that NVIDIA has been more efficient in utilizing its fixed assets to generate sales. A higher fixed asset turnover ratio generally indicates that the company is effectively managing its fixed assets to generate revenue. This improvement could be attributed to factors such as increased production capacity utilization, better inventory management, or more effective utilization of assets in the production process.

Overall, the increasing trend in NVIDIA's fixed asset turnover ratio reflects positively on the company's operational efficiency and ability to generate revenue from its investment in fixed assets. It suggests that NVIDIA has been able to leverage its fixed assets effectively to drive sales growth and profitability over the years.