Semtech Corporation (SMTC)

Payables turnover

		Jan 28, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Jan 26, 2020
Cost of revenue	US$ in thousands	1,705,820	601,097	447,929	402,465	392,680
Payables	US$ in thousands	45,051	100,676	50,695	50,189	48,009
Payables turnover		37.86	5.97	8.84	8.02	8.18

January 28, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $1,705,820K ÷ $45,051K
= 37.86

The payables turnover ratio for Semtech Corporation has shown significant fluctuations over the past five years. In January 2024, the payables turnover ratio reached 37.86, a substantial increase from the previous year's ratio of 5.97. This indicates that Semtech has been more efficient in managing its accounts payable, as it takes fewer days to pay its suppliers.

The significant increase in the payables turnover ratio from 2023 to 2024 could suggest improved cash management practices, renegotiated payment terms with suppliers, or a more efficient supply chain process. It is important to note that a higher payables turnover ratio generally reflects stronger liquidity and working capital management.

However, it is also essential to consider the context of the industry and company's specific circumstances when interpreting this ratio. Further analysis of Semtech's financial statements and industry benchmarks would provide a more comprehensive understanding of the company's payables management efficiency.