Wolfspeed Inc (WOLF)

Working capital turnover

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Revenue	US$ in thousands	807,400	878,100	699,200	478,000	880,600
Total current assets	US$ in thousands	2,999,600	3,606,500	1,762,400	1,478,700	1,592,800
Total current liabilities	US$ in thousands	665,300	627,900	388,500	448,800	291,200
Working capital turnover		0.35	0.29	0.51	0.46	0.68

June 30, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $807,400K ÷ ($2,999,600K – $665,300K)
= 0.35

The working capital turnover ratio for Wolfspeed Inc has fluctuated over the past five years. The ratio measures how efficiently the company is utilizing its working capital to generate sales revenue. A higher ratio indicates better efficiency in utilizing working capital.

In 2020, the working capital turnover was 0.68, suggesting that for every dollar of working capital, the company generated $0.68 in sales revenue. However, the ratio decreased to 0.46 in 2021, indicating a decline in efficiency in utilizing working capital during that year.

In 2022, there was a slight improvement with a ratio of 0.51, indicating a better utilization of working capital compared to the previous year. However, in 2023, the ratio decreased to 0.29, reflecting a significant drop in efficiency in managing working capital.

The most recent data for 2024 shows a working capital turnover ratio of 0.35, which is an improvement from the previous year but still lower than the ratio in 2022. This suggests that the company needs to focus on better management of its working capital to improve efficiency in generating sales revenue.

Overall, the fluctuation in Wolfspeed Inc's working capital turnover ratio indicates that the company has experienced challenges in optimizing its working capital in relation to its sales revenue generation. An upward trend in this ratio would be a positive indication of improved efficiency in managing working capital.