Super Micro Computer Inc (SMCI)
Liquidity ratios
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|
| Current ratio | 3.81 | 3.77 | 2.31 | 1.91 | 1.93 |
| Quick ratio | 1.88 | 1.80 | 1.16 | 0.75 | 0.72 |
| Cash ratio | 0.71 | 0.69 | 0.32 | 0.18 | 0.24 |
Super Micro Computer Inc. has demonstrated a consistent improvement in its liquidity position over the analyzed period from June 30, 2021, through June 30, 2025. The current ratio, which measures the company’s ability to meet short-term obligations using current assets, increased from 1.93 in 2021 to 3.81 in 2025. This indicates that the company has significantly enhanced its current asset base relative to its current liabilities, implying a stronger liquidity cushion and a reduced risk of short-term insolvency.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, shows similar positive trends, rising from 0.72 in 2021 to 1.88 in 2025. This growth signifies an improved capacity to cover immediate liabilities without relying on inventory sales, further emphasizing the company's improved liquidity posture.
The cash ratio, which isolates the most liquid assets (cash and cash equivalents), has also increased from 0.24 in 2021 to 0.71 in 2025. Although still below the 1.0 threshold, the nearly threefold rise reflects a substantial accrual of readily available cash resources, enhancing the company's short-term financial flexibility.
Overall, the upward trajectory across all three liquidity ratios suggests a strengthening liquidity position for Super Micro Computer Inc., indicating that the company has been progressively increasing its liquid assets relative to its short-term liabilities. This enhancement in liquidity ratios may imply more conservative cash management, improved operational cash flow generation, or both, thereby reducing liquidity risk and potentially supporting future operational stability and growth initiatives.
See also:
Additional liquidity measure
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 147.71 | 146.62 | 100.63 | 132.53 | 99.35 |
The cash conversion cycle (CCC) of Super Micro Computer Inc. over the observed period exhibits notable fluctuations, reflecting changes in the company's operational efficiencies related to inventory management, receivables collection, and payables management.
As of June 30, 2021, the CCC was approximately 99.35 days, indicating the time taken from the outlay of cash for inventory to the collection of receivables. In the subsequent year, this cycle increased significantly to approximately 132.53 days by June 30, 2022, suggesting a lengthening in the time required to convert investments in inventory and receivables into cash.
By June 30, 2023, the CCC reduced to about 100.63 days, approaching the earlier 2021 levels, which may reflect operational improvements or strategic changes aimed at accelerating cash flow. However, the cycle then expanded substantially in the following years, reaching approximately 146.62 days by June 30, 2024, representing a significant deterioration in cash flow efficiency. This increased cycle duration persisted into June 30, 2025, with the CCC slightly rising further to roughly 147.71 days.
Overall, the trend indicates periods of both improvement and deterioration in the company's cash conversion efficiency. The extended cycle durations in most recent years suggest challenges or shifts in operational practices, collection periods, or payment terms, resulting in a longer interval before cash is recovered. This pattern underscores the importance of managing receivables, inventories, and payables effectively to optimize working capital and enhance liquidity.