Power Integrations Inc (POWI)

Working capital turnover

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Revenue (ttm)	US$ in thousands	444,538	479,801	514,523	575,286	651,138	699,022	715,565	711,689	703,277	681,316	625,669	552,391	488,318	452,082	445,112	441,145	420,669	399,519	395,445	402,062
Total current assets	US$ in thousands	511,600	556,116	550,987	539,195	525,073	512,029	481,049	592,501	686,815	703,347	667,545	642,312	601,232	592,947	577,228	560,442	541,339	374,656	360,002	341,119
Total current liabilities	US$ in thousands	48,867	53,421	64,819	63,062	58,376	58,859	70,129	69,234	72,321	66,062	68,266	62,527	62,526	66,251	64,755	54,470	50,476	49,652	55,334	50,921
Working capital turnover		0.96	0.95	1.06	1.21	1.40	1.54	1.74	1.36	1.14	1.07	1.04	0.95	0.91	0.86	0.87	0.87	0.86	1.23	1.30	1.39

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $444,538K ÷ ($511,600K – $48,867K)
= 0.96

The working capital turnover ratio for Power Integrations Inc. fluctuated over the past eight quarters, ranging from 0.96 to 1.74. A decrease in the working capital turnover ratio indicates that the company is taking longer to convert its working capital into revenue-generating activities. Conversely, an increase in the ratio suggests that the company is efficiently utilizing its working capital to generate revenue.

In Q4 2023, the working capital turnover ratio was 0.96, which was slightly lower compared to the previous quarter's ratio of 0.95. This slight decrease may indicate a slightly less efficient use of working capital in generating revenue during this period.

Furthermore, the highest working capital turnover ratio was observed in Q2 2022 at 1.74, indicating that Power Integrations Inc. was effectively utilizing its working capital to generate revenue during that quarter. On the other hand, the lowest ratio of 0.96 was recorded in Q4 2023, suggesting a potential inefficiency in the management of working capital during this period.

Overall, the fluctuation in the working capital turnover ratios of Power Integrations Inc. over the analyzed period may require further investigation into the company's operational and financial management strategies to understand the factors influencing these variations.