SPS Commerce Inc (SPSC)

Quick ratio

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
Cash US$ in thousands 241,017 198,842 240,232 234,637 219,081 178,702 209,264 182,304 162,893 186,230 212,725 203,088 207,552 195,803 184,367 169,274 149,692 208,930 174,850 184,484
Short-term investments US$ in thousands 0 6,931 31,554 56,174 56,359 60,628 60,914 51,146 51,412 50,928 46,513 39,968 49,758 56,183 48,999 39,174 37,786 52,300 50,775 30,074
Receivables US$ in thousands 52,035 55,570 55,397 52,135 46,840 45,141 44,992 43,437 39,435 36,787 40,105 38,778 34,562 35,330 37,936 35,270 33,578 30,289 34,177 30,336
Total current liabilities US$ in thousands 146,684 146,331 128,546 134,216 130,669 132,871 111,968 106,961 110,642 105,466 101,239 94,428 102,872 94,928 91,437 83,432 80,132 70,389 66,735 61,903
Quick ratio 2.00 1.79 2.55 2.56 2.47 2.14 2.81 2.59 2.29 2.60 2.96 2.98 2.84 3.03 2.97 2.92 2.76 4.14 3.89 3.96

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($241,017K + $0K + $52,035K) ÷ $146,684K
= 2.00

The quick ratio of SPS Commerce Inc has shown fluctuations over the periods observed. The quick ratio, which measures the company's ability to meet its short-term obligations using its most liquid assets, has generally been above 1, indicating that the company has had an adequate level of liquid assets to cover its short-term liabilities.

From March 31, 2020, to September 30, 2022, the quick ratio remained consistently above 2, indicating a strong liquidity position. However, there was a notable decline in the quick ratio from December 31, 2022, to September 30, 2024, where it fell below 2 and even dropped to as low as 1.79 on September 30, 2024.

A quick ratio below 1 would suggest that the company may struggle to meet its short-term obligations without having to liquidate inventory or other assets quickly. While the quick ratio of SPS Commerce Inc has fluctuated, it is important for investors and stakeholders to monitor this ratio closely to ensure the company maintains a healthy level of liquidity to support its operations and growth.