Oracle Corporation (ORCL)
Activity ratios
Short-term
Turnover ratios
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | |
|---|---|---|---|---|---|
| Inventory turnover | — | 45.34 | 45.52 | 28.27 | 55.32 |
| Receivables turnover | 6.71 | 6.73 | 7.22 | 7.13 | 7.48 |
| Payables turnover | 0.45 | 6.42 | 11.27 | 6.74 | 10.54 |
| Working capital turnover | — | — | — | 3.50 | 1.29 |
The analysis of Oracle Corporation's activity ratios from the provided data reveals several notable trends and variations across the specified periods.
Inventory Turnover:
- The inventory turnover ratio has demonstrated significant fluctuations over the examined dates. Specifically, it decreased markedly from 55.32 times on May 31, 2021, to 28.27 times on May 31, 2022, indicating a slowdown in the frequency of inventory replenishment or sales efficiency. Subsequently, the ratio increased to 45.52 times by May 31, 2023, suggesting improvements in inventory management or sales volume, before marginally declining to 45.34 times on May 31, 2024. The absence of data for 2025 precludes further analysis.
Receivables Turnover:
- The receivables turnover ratio remained relatively stable over the period, with slight declines observed. It decreased from 7.48 times in 2021 to 7.13 times in 2022, then experienced a marginal increase to 7.22 times in 2023. A further decrease occurred to 6.73 times in 2024, continuing to decline slightly to 6.71 times in 2025. These figures suggest a relatively consistent collection period, with minor variations indicating steady but slightly lengthening accounts receivable days over time.
Payables Turnover:
- The payables turnover ratio exhibits considerable fluctuations. It rose from 10.54 times in 2021 to a peak of 11.27 times in 2023, reflecting a shorter period to pay suppliers during this interval. However, this ratio declined sharply to 6.42 times in 2024 and further dramatically to 0.45 times in 2025, indicating increasingly prolonged payment periods or potential liquidity challenges in meeting short-term obligations. The drastic decrease in 2025 suggests a significant change in payment strategy or financial structure, warranting further investigation.
Working Capital Turnover:
- The working capital turnover ratio displays a notable increase from 1.29 times in 2021 to 3.50 times in 2022, implying improved utilization of working capital to generate sales during this period. Data for subsequent years (2023 onward) are unavailable, limiting comprehensive analysis of ongoing efficiency trends, but the sharp rise observed indicates enhanced operational efficiency between 2021 and 2022.
Overall, the activity ratios depict Oracle's evolving operational efficiency, with improvements in inventory management and working capital utilization between 2021 and 2022, stability in receivables management, but significant shifts in payables behavior, especially in 2024 and 2025. The substantial decline in payables turnover in 2025 warrants further review to understand underlying causes such as changes in credit policies, liquidity concerns, or strategic supplier negotiations.
Average number of days
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 8.05 | 8.02 | 12.91 | 6.60 |
| Days of sales outstanding (DSO) | days | 54.42 | 54.27 | 50.53 | 51.20 | 48.77 |
| Number of days of payables | days | 808.95 | 56.81 | 32.40 | 54.15 | 34.62 |
The analysis of Oracle Corporation's activity ratios over the period from May 2021 to May 2024 reveals several noteworthy trends and patterns.
Days of Inventory on Hand (DOH):
The number of days of inventory on hand increased from approximately 6.60 days in May 2021 to a peak of 12.91 days in May 2022, indicating a period where inventory remained longer before being sold or utilized. Subsequently, there was a decline to 8.02 days in May 2023, with a marginal increase to 8.05 days in May 2024. The fluctuation suggests that inventory management became more efficient after May 2022, reducing inventory days closer to levels observed in 2021, although they did not revert to the lower values.
Days of Sales Outstanding (DSO):
The days of sales outstanding displayed a relatively stable trend, increasing slightly from 48.77 days in May 2021 to 51.20 days in May 2022, and maintaining a similar level through May 2023 at 50.53 days. In May 2024, DSO increased further to 54.27 days, indicating that the company took longer to collect receivables over time. This incremental rise could suggest a moderate extension in credit terms or delays in collection processes.
Number of Days of Payables:
The number of days of payables exhibited more significant fluctuations. In May 2021, payables were settled within approximately 34.62 days, but this period extended markedly to 54.15 days in May 2022. The figure then decreased to 32.40 days in May 2023, reverting closer to previous levels, and then substantially increased to 56.81 days in May 2024, reflecting a delay in settling payables. Notably, the data for May 2025 indicates 808.95 days, which appears anomalous and may suggest data inconsistency or reporting anomalies.
Overall Assessment:
The activity ratios reveal that Oracle managed to reduce inventory levels after a peak in 2022, indicating improved inventory management efficiency. However, the increasing DSO suggests that receivables are being collected more slowly over time. The fluctuations in payables days indicate variability in the company’s payment strategies, with periods of delaying payments to optimize cash flow. The abnormal figure for May 2025 in payables underscores the importance of verifying data accuracy before drawing definitive conclusions. Overall, the ratios depict a company adjusting its operational management practices, balancing inventory, receivables, and payables to optimize working capital, with some areas showing signs of extended collection periods and payables delays.
See also:
Long-term
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | |
|---|---|---|---|---|---|
| Fixed asset turnover | — | — | 2.93 | 4.37 | 5.74 |
| Total asset turnover | 0.34 | 0.38 | 0.37 | 0.39 | 0.31 |
The analysis of Oracle Corporation's long-term activity ratios over the specified periods reveals notable trends. The Fixed Asset Turnover ratio has shown a consistent decline, decreasing from 5.74 in May 2021 to 4.37 in May 2022, and further down to 2.93 by May 2023. This downward trend suggests a diminishing efficiency in generating revenue from fixed assets, possibly indicating increased investment in fixed assets or a decline in asset utilization effectiveness.
In contrast, the Total Asset Turnover ratio has exhibited relatively stable fluctuations over the same periods. Beginning at 0.31 in May 2021, it increased slightly to 0.39 in May 2022 and remained steady at 0.37 in May 2023. Projected ratios for May 2024 and 2025 are slightly higher at 0.38 and 0.34 respectively, implying a relatively stable or marginally improving overall efficiency in asset utilization.
Overall, while the fixed asset efficiency appears to be waning, total asset efficiency remains relatively resilient, suggesting that the company may be diversifying its assets or optimizing utilization across a broader asset base. The diverging trends highlight an area of potential strategic focus, particularly concerning fixed asset management and utilization efficiency.