News Corp A (NWSA)

The liquidity position of News Corp A has exhibited the following trends over the observed period from June 30, 2021, to June 30, 2025.

The current ratio, which measures the company’s ability to cover short-term liabilities with its current assets, has fluctuated but generally trended upward in the latter part of the period. It declined from 1.38 in 2021 to a low of 1.16 in 2022, indicating a slight weakening in liquidity during that year. Subsequently, it increased to 1.28 in 2023, then showed a notable improvement to 1.43 in 2024, and further to 1.84 in 2025. This indicates an overall strengthening of the company’s short-term asset management and liquidity cushion.

The quick ratio, which refines the current ratio by excluding inventory from current assets, followed a similar pattern. It decreased from 1.15 in 2021 to a low of 0.96 in 2022, signaling a temporary decline in the company’s ability to meet short-term obligations with the most liquid assets. The ratio regained stability and increased modestly to 1.04 in 2023, then demonstrated consistent improvement to 1.14 in 2024 and reached 1.53 in 2025. These figures suggest an enhanced liquidity position, predominantly in liquid assets excluding inventory, over the latter years.

The cash ratio, representing the most conservative measure of liquidity by focusing solely on cash and cash equivalents relative to current liabilities, decreased from 0.69 in 2021 to 0.54 in 2022. It slightly increased to 0.59 in 2023, then continued upward to 0.65 in 2024, and ultimately reached 0.92 in 2025. This trend indicates a gradual accumulation of cash and cash equivalents, substantially improving the company’s ability to meet immediate short-term liabilities.

In summary, while there was a temporary dip in liquidity ratios around 2022, News Corp A has demonstrated a general upward trend in all three key liquidity measures over the analyzed period. The progressive improvements in the current, quick, and cash ratios suggest a strengthening liquidity position, resulting in greater short-term financial stability and a more robust capacity to meet its short-term obligations by 2025.

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Additional liquidity measure

The cash conversion cycle (CCC) of News Corp A exhibits notable fluctuations over the specified periods. As of June 30, 2021, the CCC stood at approximately 53.93 days, indicating the average number of days it takes for the company to convert its investments in inventory and other resources into cash flows from sales. By June 30, 2022, the cycle had decreased to approximately 46.51 days, reflecting an improvement in the company's efficiency in managing its receivables and payables, thereby shortening the time required to convert investments into cash. This downward trend continued into June 30, 2023, with the cycle slightly decreasing further to approximately 44.58 days, suggesting continued operational efficiencies or changes in credit and inventory management practices.

However, a reversal of this trend is observed moving into June 30, 2024, when the CCC increased dramatically to around 53.26 days. This rise indicates a lengthening of the cycle, potentially due to slower collections from customers, extended inventory holding periods, or delays in payables. The trend continues with a significant increase to approximately 68.01 days by June 30, 2025, pointing towards a substantial deterioration in cash flow management efficiency. This prolonged cycle may adversely impact liquidity and working capital management, signaling potential operational challenges or changes in credit policies.

Overall, the company's cash conversion cycle demonstrates an initial period of improvement through 2023, followed by a notable deterioration in 2024 and 2025. This pattern suggests shifts in operational efficiency, credit management, and payment strategies that warrant further investigation to understand underlying causes and their implications on the company's liquidity position.