Rambus Inc (RMBS)

Working capital turnover

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
Revenue (ttm) US$ in thousands 556,624 517,747 477,532 465,226 461,117 461,259 468,205 469,505 454,793 424,207 393,245 356,972 328,304 298,436 274,069 250,927 246,322 246,144 248,416 244,996
Total current assets US$ in thousands 690,257 612,013 610,158 576,456 630,645 550,625 536,465 492,763 527,214 474,177 581,146 545,112 684,364 624,759 678,985 724,336 699,712 725,034 707,796 678,756
Total current liabilities US$ in thousands 81,812 74,127 85,034 82,607 89,121 84,196 101,444 96,174 126,709 116,431 161,444 168,402 267,267 95,175 81,426 80,402 85,864 90,882 83,458 80,063
Working capital turnover 0.91 0.96 0.91 0.94 0.85 0.99 1.08 1.18 1.14 1.19 0.94 0.95 0.79 0.56 0.46 0.39 0.40 0.39 0.40 0.41

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $556,624K ÷ ($690,257K – $81,812K)
= 0.91

The working capital turnover of Rambus Inc has displayed fluctuating trends over the past few years. The ratio was relatively low in the range of 0.39 to 0.41 from March 2020 to December 2021, indicating that the company was not efficiently utilizing its working capital to generate sales. However, there was a noticeable improvement starting from March 2022, with the ratio steadily increasing to a peak of 1.19 by September 2022.

This significant improvement in working capital turnover suggests that Rambus Inc became more effective in managing its working capital and converting it into revenue during this period. Although there was a slight decrease in the ratio from September 2022 to December 2023, it remained relatively high compared to previous years.

After December 2023, the working capital turnover ratio fluctuated between 0.85 and 0.96 until December 2024. While the ratio did not reach the levels seen in early 2022, it still remained higher than the initial years, indicating continued efficiency in working capital management.

Overall, the increasing trend in the working capital turnover ratio from March 2022 to September 2022, followed by relatively stable but improved performance, reflects positive enhancements in Rambus Inc's working capital utilization and operational efficiency.