Vertex Pharmaceuticals Inc (VRTX)

Working capital turnover

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Revenue (ttm)	US$ in thousands	9,803,200	9,596,700	9,444,700	9,144,300	8,863,500	8,628,770	8,277,080	7,873,370	7,499,400	7,066,960	6,622,470	6,355,190	6,147,530	5,935,020	5,347,582	4,763,428	4,106,025	3,577,111	3,416,521	3,232,116
Total current assets	US$ in thousands	14,144,200	14,695,800	13,872,900	12,965,700	13,234,800	12,271,000	11,503,500	10,361,300	9,560,600	8,852,540	8,457,510	8,539,310	8,133,400	7,458,460	6,694,320	5,446,400	4,822,830	4,777,090	4,710,970	4,183,040
Total current liabilities	US$ in thousands	3,547,400	3,599,400	3,352,100	3,026,200	2,742,100	2,609,300	2,556,200	2,180,200	2,142,000	1,914,260	1,836,450	1,944,050	1,877,500	2,004,030	1,798,640	1,538,750	1,334,830	1,388,890	1,259,220	1,106,470
Working capital turnover		0.93	0.86	0.90	0.92	0.84	0.89	0.93	0.96	1.01	1.02	1.00	0.96	0.98	1.09	1.09	1.22	1.18	1.06	0.99	1.05

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $9,803,200K ÷ ($14,144,200K – $3,547,400K)
= 0.93

The working capital turnover for Vertex Pharmaceuticals, Inc. has ranged between 0.85 and 0.97 over the past eight quarters. The metric illustrates the number of times a company's working capital is used to generate revenue over a specific period. A higher working capital turnover indicates that the company efficiently generates revenue from its working capital.

In the case of Vertex Pharmaceuticals, Inc., the working capital turnover has been relatively stable, fluctuating within a narrow range of 0.85 to 0.97. This consistency suggests that the company has been effectively utilizing its working capital to drive revenue generation consistently over the quarters analyzed.

While a working capital turnover of around 0.90 indicates that Vertex Pharmaceuticals, Inc. is turning over its working capital approximately once a year, this metric should be evaluated in conjunction with other financial ratios and performance indicators to gain a comprehensive understanding of the company's operational efficiency and financial health.