Viavi Solutions Inc (VIAV)

Working capital turnover

Jun 30, 2024 Jun 30, 2023 Jun 30, 2022 Jun 30, 2021 Jun 30, 2020
Revenue US$ in thousands 1,000,400 1,106,100 1,292,400 1,198,900 1,136,300
Total current assets US$ in thousands 876,500 945,000 1,005,100 1,112,100 913,600
Total current liabilities US$ in thousands 247,100 343,500 369,300 747,400 232,800
Working capital turnover 1.59 1.84 2.03 3.29 1.67

June 30, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,000,400K ÷ ($876,500K – $247,100K)
= 1.59

Viavi Solutions Inc's working capital turnover has shown a declining trend over the past five years. The ratio decreased from 3.29 in 2021 to 1.59 in 2024, which indicates that the company may be managing its working capital less efficiently. A lower working capital turnover ratio suggests that Viavi Solutions Inc is generating less revenue relative to its working capital investment. This could imply that the company is not effectively utilizing its current assets to generate sales revenue. Further analysis is warranted to understand the underlying reasons for this decline and to identify potential areas for improvement in working capital management.