Western Digital Corporation (WDC)

Activity ratios

Short-term

Turnover ratios

	Jun 30, 2024	Mar 31, 2024	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
Inventory turnover	3.37	3.51	3.55	3.31	3.19	3.14	3.49	3.57	3.99	4.07	4.04	4.08	3.92	3.83	3.98	4.35	4.86	4.85	4.82	4.55
Receivables turnover	6.03	6.44	7.20	7.64	7.51	8.73	8.12	7.10	6.60	—	6.79	—	7.35	—	—	—	—	—	—	—
Payables turnover	—	—	—	—	—	9.55	11.04	8.19	7.63	8.11	7.29	7.62	7.33	7.81	7.34	7.50	7.68	8.39	8.67	8.67
Working capital turnover	6.63	3.33	3.49	6.21	4.90	4.31	3.87	4.19	4.39	3.95	4.04	3.45	3.40	3.52	3.51	3.59	3.59	3.94	3.73	3.64

The activity ratios of Western Digital Corporation show fluctuations over the reported periods.

1. Inventory Turnover: The efficiency of managing inventory fluctuated between 3.19 and 4.86 times over the past few quarters. A higher turnover indicates that the company is selling its inventory more quickly, which can be positive for cash flow and profitability.

2. Receivables Turnover: The turnover of receivables ranged from 6.03 to 8.73 times, reflecting the effectiveness of the company in collecting outstanding receivables. A higher turnover suggests that the company is efficient in collecting payments from customers.

3. Payables Turnover: Payables turnover figures indicate how quickly the company is paying its suppliers. The turnover varied between 7.29 and 11.04 times, showing the speed at which the company settles its payables. A higher turnover may indicate a more favorable credit term from suppliers.

4. Working Capital Turnover: The working capital turnover ranges between 3.33 and 6.63 times, reflecting how efficiently the company is utilizing its working capital to generate sales. A higher turnover implies better utilization of resources to support revenue generation.

Overall, analyzing these activity ratios provides insights into the operational efficiency and effectiveness of Western Digital Corporation in managing its inventory, receivables, payables, and working capital to drive business performance. Further comparative analysis against industry benchmarks or historical trends could provide additional context for a more comprehensive evaluation.

Average number of days

		Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	108.26	104.10	102.85	110.37	114.37	116.38	104.61	102.12	91.55	89.77	90.35	89.50	93.06	95.28	91.69	83.82	75.04	75.30	75.73	80.29
Days of sales outstanding (DSO)	days	60.51	56.66	50.68	47.80	48.59	41.82	44.95	51.42	55.32	—	53.74	—	49.63	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	38.23	33.08	44.58	47.86	45.02	50.09	47.88	49.78	46.75	49.72	48.69	47.54	43.51	42.11	42.11

Days of inventory on hand (DOH) measures how many days, on average, it takes for a company to sell its inventory. Western Digital Corporation's DOH has been fluctuating over the past few quarters, ranging from 83.82 days to 116.38 days. A decreasing trend in DOH could indicate efficient inventory management, whereas an increasing trend may suggest excess inventory or potential sales challenges.

Days of sales outstanding (DSO) reflects the average number of days it takes a company to collect revenue after a sale is made. Western Digital Corporation's DSO has also varied, with values ranging from 41.82 days to 60.51 days. A lower DSO is generally favorable as it indicates quicker cash conversion from sales.

Number of days of payables represents how long it takes the company to pay its suppliers. Unfortunately, data for this ratio is missing for some quarters. However, the available information shows fluctuations in the number of days of payables, which can impact cash flow management. A longer payable period may indicate effective cash flow management but could strain relationships with suppliers if extended too far.

Overall, Western Digital Corporation's activity ratios suggest fluctuations in inventory management, sales collection efficiency, and payment terms to suppliers. It is important for the company to closely monitor and manage these ratios to maintain optimal working capital levels and operational efficiency.

Long-term

	Jun 30, 2024	Mar 31, 2024	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
Fixed asset turnover	4.13	3.56	3.31	3.29	3.32	3.79	4.19	4.62	5.04	5.41	5.53	5.44	5.21	5.21	5.51	5.68	5.83	5.88	5.68	5.49
Total asset turnover	0.54	0.49	0.45	0.46	0.49	0.55	0.62	0.67	0.70	0.73	0.72	0.67	0.64	0.63	0.63	0.65	0.65	0.63	0.60	0.58

Western Digital Corporation's long-term activity ratios, specifically the fixed asset turnover and total asset turnover, provide insights into the company's efficiency in utilizing its assets to generate sales.

The fixed asset turnover ratio has shown fluctuations over the provided period, ranging from 3.29 to 5.41. This ratio indicates that for each dollar invested in fixed assets, Western Digital generated sales revenue between 3.29 to 5.41 times. The increasing trend of this ratio from 3.29 in September 2023 to 5.41 in March 2022 suggests that the company improved its efficiency in utilizing fixed assets to generate revenue. However, there was a slight decline in recent quarters, indicating a potential decrease in the effectiveness of utilizing fixed assets efficiently.

On the other hand, the total asset turnover ratio fluctuated between 0.45 and 0.73 during the same period. This ratio indicates the company's ability to generate sales relative to its total assets. A higher ratio suggests better efficiency in asset utilization. The increasing trend from 0.45 in December 2023 to 0.73 in March 2022 indicates that Western Digital effectively increased sales generated per dollar of total assets during that period. Despite some fluctuations, the general trend suggests that the company has been improving its efficiency in utilizing total assets to generate sales.

In conclusion, Western Digital Corporation has shown variations in its long-term activity ratios over the period analyzed. While the fixed asset turnover ratio has fluctuated, indicating some challenges in efficiently utilizing fixed assets, the total asset turnover ratio demonstrated an overall improvement, showing enhanced efficiency in generating sales relative to total assets. This analysis suggests that the company has been working on optimizing its asset utilization to drive revenue growth.