NXP Semiconductors NV (NXPI)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.36 | 2.35 | 2.21 | 2.35 | 1.91 | 1.92 | 1.82 | 1.75 | 2.12 | 2.08 | 2.15 | 1.85 | 2.13 | 1.37 | 2.26 | 1.78 | 2.14 | 1.64 | 1.74 | 1.77 |
| Quick ratio | 1.06 | 1.05 | 1.05 | 1.13 | 1.04 | 0.96 | 0.95 | 0.93 | 1.18 | 1.17 | 1.21 | 0.94 | 1.15 | 0.67 | 1.25 | 0.81 | 1.13 | 1.05 | 1.09 | 0.59 |
| Cash ratio | 1.06 | 1.05 | 1.05 | 1.13 | 1.04 | 0.96 | 0.95 | 0.93 | 1.18 | 1.17 | 1.21 | 0.94 | 1.15 | 0.67 | 1.25 | 0.81 | 1.13 | 1.05 | 1.09 | 0.59 |
The liquidity ratios of NXP Semiconductors NV, namely the current ratio, quick ratio, and cash ratio, provide insight into the company's ability to meet its short-term financial obligations.
1. Current Ratio: The current ratio measures the company's ability to pay off its current liabilities with its current assets. The current ratio for NXP Semiconductors has shown some fluctuations over the years, ranging from a low of 1.37 in September 2021 to a high of 2.36 in December 2024. Overall, the current ratio has generally remained above 1, indicating that the company has had sufficient current assets to cover its current liabilities.
2. Quick Ratio: The quick ratio, also known as the acid-test ratio, is a more stringent measure of liquidity that excludes inventory from current assets. NXP Semiconductors' quick ratio has varied over time, fluctuating between 0.59 in March 2020 and 1.18 in December 2022. The quick ratio generally remained above 1, suggesting that the company has had an acceptable level of quick assets to cover its short-term liabilities.
3. Cash Ratio: The cash ratio is the most conservative liquidity ratio, focusing solely on the company's ability to cover its current liabilities with cash and cash equivalents. NXP Semiconductors' cash ratio has also fluctuated, ranging from 0.59 in March 2020 to 1.06 in December 2024. Similar to the quick ratio, the cash ratio has generally remained above 1, indicating that the company has maintained a sufficient level of cash to meet its short-term obligations.
Overall, NXP Semiconductors NV has generally maintained liquidity levels that suggest the company has been able to meet its short-term financial obligations, as indicated by the current, quick, and cash ratios staying above 1 for the most part over the years.
See also:
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 153.29 | 142.43 | 135.62 | 131.56 | 134.57 | 137.98 | 135.64 | 127.00 | 114.35 | 103.07 | 98.84 | 93.04 | 86.87 | 87.68 | 85.18 | 84.43 | 85.89 | 91.38 | 107.95 | 104.79 |
The cash conversion cycle of NXP Semiconductors NV, a key indicator of its efficiency in managing working capital, has shown some fluctuations over the periods analyzed. From March 31, 2020, to December 31, 2024, the cash conversion cycle ranged from a low of 84.43 days to a high of 153.29 days.
The trend in the cash conversion cycle shows an initial decrease from March 31, 2020, to March 31, 2021, indicating an improvement in the company's ability to convert its investments in inventory and receivables into cash. However, from March 31, 2021, there was a gradual increase in the cash conversion cycle, reaching its peak by December 31, 2024.
This increase suggests a potential slowdown in the conversion of resources into cash, which could be attributed to various factors such as changes in the company's sales terms, inventory management practices, or the efficiency of its accounts receivable collections.
Overall, a rising cash conversion cycle may indicate that NXP Semiconductors NV is taking longer to generate cash from its operations, potentially signaling challenges in liquidity management or operational efficiency that warrant further investigation and analysis.