Warner Bros Discovery Inc (WBD)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	3,780,000	3,731,000	3,905,000	2,091,000	1,552,000
Short-term investments	US$ in thousands	53,000	28,000	120,000	268,000	11,000
Total current liabilities	US$ in thousands	15,332,000	15,017,000	3,459,000	3,082,000	3,239,000
Cash ratio		0.25	0.25	1.16	0.77	0.48

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($3,780,000K + $53,000K) ÷ $15,332,000K
= 0.25

Warner Bros. Discovery Inc's cash ratio has fluctuated over the past five years, ranging from 0.45 to 1.39. The cash ratio measures a company's ability to cover its short-term liabilities with its cash and cash equivalents. A higher cash ratio indicates a stronger ability to cover short-term obligations without relying on external sources.

In 2021, the cash ratio was 1.39, indicating that Warner Bros. Discovery had a solid cash position relative to its short-term liabilities. This high ratio suggests that the company could easily meet its current financial obligations using its available cash reserves.

In contrast, the cash ratio decreased in 2022 and 2023 to 0.43 and 0.45, respectively. These lower ratios may suggest a decrease in the company's ability to cover its short-term liabilities with cash alone. This could potentially indicate a need to manage its cash position more effectively or explore other sources of liquidity to meet its short-term obligations.

Overall, while Warner Bros. Discovery Inc's cash ratio has shown fluctuations, it is important for the company to maintain a balance between cash reserves and investing in growth opportunities to ensure financial stability and flexibility in managing its short-term obligations.