Vertex Pharmaceuticals Inc (VRTX)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	10,994,400	9,803,200	8,863,500	7,499,400	6,135,450
Total current assets	US$ in thousands	9,596,400	14,144,200	13,234,800	9,560,600	8,133,400
Total current liabilities	US$ in thousands	3,564,600	3,547,400	2,742,100	2,142,000	1,877,500
Working capital turnover		1.82	0.93	0.84	1.01	0.98

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $10,994,400K ÷ ($9,596,400K – $3,564,600K)
= 1.82

The working capital turnover for Vertex Pharmaceuticals Inc has fluctuated over the past five years. It was relatively stable around 0.98 in December 31, 2020, and 1.01 in December 31, 2021. However, there was a slight decrease to 0.84 in December 31, 2022, followed by a modest increase to 0.93 in December 31, 2023. The most significant change occurred in December 31, 2024, where the working capital turnover surged to 1.82.

This indicates that, on average, Vertex Pharmaceuticals Inc has been able to generate $0.98 to $1.82 in revenue for each dollar of working capital invested. The increase in the working capital turnover ratio in 2024 could suggest improved efficiency in managing working capital or potential growth opportunities.

It is important for Vertex Pharmaceuticals Inc to continue monitoring this ratio to ensure optimal utilization of working capital and sustaining growth in revenue generation relative to the amount of working capital employed.