Verizon Communications Inc (VZ)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 53,438,000 | 57,919,000 | 45,169,000 | 41,288,000 | 48,939,000 |
| Payables | US$ in thousands | 10,425,000 | 10,021,000 | 8,750,000 | 8,040,000 | 6,667,000 |
| Payables turnover | 5.13 | 5.78 | 5.16 | 5.14 | 7.34 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $53,438,000K ÷ $10,425,000K
= 5.13
Verizon Communications Inc's payables turnover ratio indicates the number of times the company pays its suppliers within a specific period. The trend of the payables turnover ratio over the years shows a decrease from 7.34 in December 2020 to 5.13 in December 2024.
A decreasing payables turnover ratio could suggest that Verizon is taking longer to pay its suppliers, which might indicate either less favorable credit terms negotiated with suppliers or potential liquidity constraints. It could also imply a decrease in purchasing or inventory turnover efficiency.
Monitoring the payables turnover ratio is crucial for assessing the company's ability to manage its trade credit effectively and maintain good relationships with suppliers. Verizon should continue to analyze the underlying reasons for the decline in payables turnover to ensure efficient cash flow management and sustainable supplier relationships.
Peer comparison
Dec 31, 2024