Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Paying user area
Try for free
Alphabet Inc. pages available for free this week:
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Total Asset Turnover since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Debt
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to Alphabet Inc. for $24.99.
This is a one-time payment. There is no automatic renewal.
We accept:
Liquidity Ratios (Summary)
Alphabet Inc., liquidity ratios
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Current ratio | ||||||
| Quick ratio | ||||||
| Cash ratio |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
An examination of the liquidity ratios reveals a general declining trend from 2021 through 2024, followed by a slight recovery in 2025. This suggests a decreasing ability to meet short-term obligations with increasingly liquid assets over the initial period, with a modest improvement in the most recent year.
- Current Ratio
- The current ratio decreased consistently from 2.93 in 2021 to 1.84 in 2024, indicating a diminishing capacity to cover current liabilities with current assets. A subsequent increase to 2.01 in 2025 suggests a partial restoration of this capacity, though it remains below the 2021 level.
- Quick Ratio
- Mirroring the current ratio, the quick ratio also exhibited a downward trend from 2.79 in 2021 to 1.66 in 2024. This decline indicates a weakening ability to meet short-term obligations with the most liquid assets, excluding inventory. The ratio improved to 1.85 in 2025, but still remains lower than its value in 2021.
- Cash Ratio
- The cash ratio demonstrated the most pronounced decline, decreasing from 2.17 in 2021 to 1.07 in 2024. This signifies a substantial reduction in the ability to cover immediate liabilities with cash and cash equivalents. A rise to 1.23 in 2025 represents a recovery, but the ratio remains significantly lower than its initial value.
The consistent decline in all three liquidity ratios from 2021 to 2024 warrants attention. While the 2025 figures indicate a stabilization and slight improvement, the overall trend suggests a potential increase in liquidity risk during the analyzed period. The magnitude of the decline is greatest for the cash ratio, indicating a shift away from holding highly liquid assets.
Current Ratio
Alphabet Inc., current ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Current ratio1 | ||||||
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Trade Desk Inc. | ||||||
| Walt Disney Co. | ||||||
| Current Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| Current Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The current ratio exhibited a declining trend from 2021 to 2024, followed by a modest increase in 2025. This indicates a shifting liquidity position over the analyzed period.
- Current Ratio Trend
- The current ratio began at 2.93 in 2021, suggesting a strong ability to cover short-term obligations with short-term assets. A consistent decrease was observed through 2024, reaching a low of 1.84. This decline signifies a weakening in the company’s short-term liquidity position. However, the ratio experienced a slight recovery to 2.01 in 2025.
Concurrent with the declining current ratio, current liabilities increased consistently from US$64.254 billion in 2021 to US$102.745 billion in 2025. While current assets also fluctuated, they did not increase at the same rate as current liabilities, contributing to the observed decrease in the current ratio.
- Asset and Liability Dynamics
- Current assets decreased from US$188.143 billion in 2021 to US$164.795 billion in 2022, then showed a slight increase to US$171.530 billion in 2023 before decreasing again to US$163.711 billion in 2024. A notable increase to US$206.038 billion was observed in 2025. This volatility in current assets, combined with the steady rise in current liabilities, explains the overall trend in the current ratio.
- Implications of the Trend
- The decrease in the current ratio from 2021 to 2024 suggests a potential increase in short-term financial risk. A ratio below 2.00 may indicate that the company has less of a cushion to meet its immediate obligations. The slight improvement in 2025 is a positive sign, but continued monitoring is warranted to assess the sustainability of this trend.
The observed changes in the current ratio warrant further investigation into the composition of both current assets and current liabilities to understand the underlying drivers of these trends.
Quick Ratio
Alphabet Inc., quick ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash, cash equivalents, and marketable securities | ||||||
| Accounts receivable, net | ||||||
| Total quick assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Quick ratio1 | ||||||
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Trade Desk Inc. | ||||||
| Walt Disney Co. | ||||||
| Quick Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| Quick Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The quick ratio demonstrates a declining trend from 2021 to 2024, followed by a modest increase in the most recent year presented. This indicates a shifting pattern in the company’s ability to meet its short-term obligations with its most liquid assets.
- Quick Ratio Trend
- The quick ratio began at 2.79 in 2021. A consistent decrease was observed through 2024, reaching a low of 1.66. In 2025, the ratio increased to 1.85, suggesting a potential stabilization, though remaining below the levels seen in earlier periods.
- Quick Asset Evolution
- Total quick assets decreased from US$178,953 million in 2021 to US$154,020 million in 2022. A slight recovery to US$158,880 million occurred in 2023, but then decreased again to US$147,997 million in 2024. A notable increase to US$189,729 million was recorded in 2025.
- Current Liability Evolution
- Current liabilities exhibited a steady increase throughout the analyzed period. Starting at US$64,254 million in 2021, they rose to US$69,300 million in 2022, US$81,814 million in 2023, US$89,122 million in 2024, and further to US$102,745 million in 2025. This consistent growth in short-term obligations contributed to the observed decline in the quick ratio.
The combined effect of decreasing quick assets (until 2025) and increasing current liabilities explains the downward trend in the quick ratio. The increase in the quick ratio in 2025 is attributable to a more substantial growth in quick assets than in current liabilities during that year.
Cash Ratio
Alphabet Inc., cash ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash, cash equivalents, and marketable securities | ||||||
| Total cash assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Cash ratio1 | ||||||
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Trade Desk Inc. | ||||||
| Walt Disney Co. | ||||||
| Cash Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| Cash Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The cash ratio exhibited a declining trend from 2021 to 2024, followed by a modest increase in 2025. This indicates a shifting pattern in the company’s most liquid asset coverage of its immediate obligations.
- Cash Ratio Trend
- The cash ratio decreased from 2.17 in 2021 to 1.07 in 2024, representing a substantial reduction in the company’s ability to cover current liabilities with only cash and cash equivalents. This decline suggests a potential increase in reliance on other current assets or a rise in current liabilities relative to cash holdings. However, the ratio experienced a slight recovery to 1.23 in 2025, signaling a partial restoration of immediate liquidity.
- Total Cash Assets
- Total cash assets decreased from US$139,649 million in 2021 to US$110,916 million in 2023, before falling further to US$95,657 million in 2024. This represents a significant reduction in readily available funds over the period. A subsequent increase to US$126,843 million in 2025 partially offset these prior declines.
- Current Liabilities
- Current liabilities consistently increased throughout the observed period, rising from US$64,254 million in 2021 to US$102,745 million in 2025. This continuous growth in short-term obligations contributed to the decreasing cash ratio, particularly between 2021 and 2024, as cash assets did not increase at the same rate.
The combination of decreasing cash assets and increasing current liabilities resulted in a weakening cash position from 2021 to 2024. The improvement in the cash ratio in 2025 is attributable to the increase in total cash assets, which outpaced the growth in current liabilities during that year.