Palo Alto Networks Inc (PANW)
Cash ratio
| Jul 31, 2025 | Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 2,268,600 | 1,535,200 | 1,135,300 | 2,118,500 | 1,874,200 |
| Short-term investments | US$ in thousands | 634,600 | 1,043,600 | 1,254,700 | 1,516,000 | 1,026,900 |
| Total current liabilities | US$ in thousands | 7,988,000 | 7,682,700 | 7,737,500 | 8,306,300 | 5,116,700 |
| Cash ratio | 0.36 | 0.34 | 0.31 | 0.44 | 0.57 |
July 31, 2025 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($2,268,600K
+ $634,600K)
÷ $7,988,000K
= 0.36
The cash ratio of Palo Alto Networks Inc has exhibited a declining trend over the reviewed period, reflecting variations in the company's liquidity position. As of July 31, 2021, the cash ratio stood at 0.57, indicating that the company's cash and cash equivalents were more than half of its current liabilities—suggesting a relatively strong liquidity buffer. By July 31, 2022, this ratio decreased to 0.44, representing a reduction in available liquid assets relative to current liabilities. The downward trend continued through July 31, 2023, when the cash ratio further declined to 0.31, indicating a diminished capacity to cover current liabilities solely with cash and cash equivalents.
In subsequent years, modest recoveries were observed. As of July 31, 2024, the cash ratio increased slightly to 0.34, and by July 31, 2025, it rose further to 0.36. Despite this slight uptick, the ratio remained below the 0.5 threshold throughout the period, suggesting that the company's cash holdings have become a smaller proportion of current liabilities over time.
Overall, the decreasing trend from 2021 to 2023 indicates a reduction in the company's liquidity buffer measured by the cash ratio, which could be attributable to factors such as increased current liabilities, strategic allocations of cash into investments or operational needs, or changes in cash management policies. The minor recovery in the subsequent years highlights some stabilization but does not fully reverse the earlier decline. These movements imply that while Palo Alto Networks maintains sufficient liquidity, its reliance on cash alone to cover short-term obligations has decreased over this period.