Trade Desk Inc (TTD)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	1,369,460	895,129	1,030,510	754,154	437,353
Short-term investments	US$ in thousands	552,026	485,159	416,080	204,625	186,685
Total current liabilities	US$ in thousands	2,873,460	2,510,840	2,029,320	1,803,300	1,474,680
Cash ratio		0.67	0.55	0.71	0.53	0.42

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,369,460K + $552,026K) ÷ $2,873,460K
= 0.67

The cash ratio trend for Trade Desk Inc from December 31, 2020, through December 31, 2024, reflects a generally positive development in the company's short-term liquidity position.

At the end of 2020, the cash ratio was 0.42, indicating that the company's cash and cash equivalents covered approximately 42% of its current liabilities. This level suggests a moderate liquidity buffer but also indicates room for improvement in cash coverage.

The ratio increased to 0.53 by December 31, 2021, signifying a strengthening liquidity position, with cash and cash equivalents covering just over half of the current liabilities. This improvement implies effective liquidity management or increased cash holdings relative to short-term obligations.

The upward trend continued into 2022, with the ratio reaching 0.71. This indicates that the company's cash reserves were more than sufficient to cover current liabilities, providing a substantial liquidity cushion. This level of liquidity likely enhanced the company's ability to meet short-term obligations without resorting to external financing.

In 2023, the cash ratio declined slightly to 0.55, though it still remained above the 0.50 level. Despite the decrease, the ratio indicates that the company retained a robust cash position relative to current liabilities, suggesting a minor reduction in cash coverage but maintaining sound liquidity health.

The ratio then increased again to 0.67 by the end of 2024, demonstrating a recovery and improvement in liquidity strength. The cash reserves in relation to current liabilities in this year again approached a high coverage level, reinforcing the company's capacity to meet short-term obligations comfortably.

Overall, the cash ratio trend from 2020 to 2024 exhibits a trajectory of initial growth, peaking in 2022, followed by a slight dip and subsequent recovery. The variations suggest that Trade Desk Inc has maintained a generally strong short-term liquidity position throughout this period, with fluctuations that may reflect operational, strategic, or external factors impacting cash holdings relative to current liabilities.