Booking Holdings Inc. (NASDAQ:BKNG)

The liquidity position of the company demonstrates a declining trend from 2021 through 2023, followed by a period of stabilization between 2023 and 2025. All three liquidity ratios – current, quick, and cash – exhibit this pattern. While there is a slight recovery in 2024 and 2025, levels remain below those observed in the earlier period.

Current Ratio

The current ratio decreased from 2.10 in 2021 to 1.28 in 2023, indicating a weakening ability to meet short-term obligations with current assets. A modest increase is then noted in 2024 (1.31) and 2025 (1.33), suggesting a slight improvement, but the ratio remains considerably lower than the 2021 level.

Quick Ratio

Mirroring the current ratio, the quick ratio declined from 2.00 in 2021 to 1.20 in 2023. This suggests a diminishing capacity to cover immediate liabilities with the most liquid assets. Similar to the current ratio, the quick ratio shows a slight increase to 1.24 in 2024 and 1.26 in 2025, but remains below the initial value.

Cash Ratio

The cash ratio experienced the most substantial decline, falling from 1.79 in 2021 to 0.95 in 2023. This indicates a significant reduction in the company’s ability to cover short-term liabilities solely with cash and cash equivalents. The ratio stabilizes at 1.03 in both 2024 and 2025, representing a partial recovery, but still falling short of the 2021 figure.

The consistent decline across all three ratios from 2021 to 2023 suggests a potential shift in the company’s working capital management or an increase in short-term liabilities relative to liquid assets. The stabilization observed from 2023 to 2025 indicates that the decline has been arrested, but the company’s liquidity position remains comparatively weaker than it was in 2021.

The current ratio experienced a declining trend from 2021 to 2023, followed by a period of stabilization and slight improvement through 2025. Initial values indicate a healthy liquidity position, which subsequently diminished before leveling off.

Current Ratio Trend

In 2021, the current ratio stood at 2.10, suggesting a strong ability to cover short-term obligations with short-term assets. A decrease was observed in 2022, with the ratio falling to 1.86. This downward trend accelerated in 2023, with the current ratio reaching 1.28, indicating a reduced margin of safety in meeting short-term liabilities. From 2023 to 2025, the ratio exhibited a stabilizing pattern, increasing modestly to 1.31 in 2024 and further to 1.33 in 2025. While the ratio did not return to the levels seen in 2021 and 2022, the stabilization suggests a potential halt to the deterioration in short-term liquidity.

The decline in the current ratio from 2021 to 2023 coincided with increases in both current assets and current liabilities, however, the growth in current liabilities outpaced that of current assets. The subsequent stabilization from 2024 to 2025 suggests a more balanced growth between these two components of the ratio.

Component Analysis

Current assets increased consistently throughout the period, rising from US$13,145 million in 2021 to US$22,264 million in 2025. Current liabilities also increased, but at a more rapid rate between 2021 and 2023, growing from US$6,246 million to US$13,330 million. The rate of increase in current liabilities slowed down in 2024 and 2025, reaching US$16,698 million. This shift in the growth rates of current assets and current liabilities contributed to the stabilization of the current ratio in the later years.

The current ratio in 2025, while improved from its low in 2023, remains below the levels observed in the earlier part of the period. Continued monitoring of this ratio is recommended to assess the long-term sustainability of the company’s short-term liquidity position.

The quick ratio demonstrates a fluctuating pattern over the five-year period. Initially, the ratio decreased before stabilizing and showing a slight increase in the most recent years.

Overall Trend

The quick ratio began at 2.00 in 2021 and decreased to 1.20 in 2023. It then exhibited a modest recovery, reaching 1.24 in 2024 and 1.26 in 2025. This suggests a diminishing ability to meet short-term obligations with highly liquid assets in the earlier part of the period, followed by a stabilization.

Quick Asset Evolution

Total quick assets increased consistently throughout the period, rising from US$12,510 million in 2021 to US$21,023 million in 2025. This indicates a general growth in the company’s most liquid assets.

Liability Impact

Current liabilities experienced a more substantial increase than quick assets, growing from US$6,246 million in 2021 to US$16,698 million in 2025. The significant rise in current liabilities, particularly between 2022 and 2023, is the primary driver behind the initial decline in the quick ratio.

Ratio Stabilization

The stabilization of the quick ratio in 2024 and 2025 is attributable to the continued growth of quick assets offsetting further increases in current liabilities. While the ratio did not return to its initial level, the trend suggests improved short-term liquidity management in the later years of the period.

In summary, while quick assets grew consistently, the faster expansion of current liabilities initially pressured the quick ratio. The ratio’s subsequent stabilization indicates a balancing of these forces, though the level remains considerably lower than the starting point.

The cash ratio exhibited fluctuations over the five-year period. Initially, the ratio decreased before stabilizing in the latter years of the observed timeframe. Total cash assets generally increased, while current liabilities experienced more substantial and consistent growth.

Cash Ratio Trend

The cash ratio began at 1.79 in 2021, indicating a strong ability to meet current obligations with available cash. A decline was observed in 2022, with the ratio falling to 1.46. This downward trend continued into 2023, reaching a low of 0.95. The ratio then showed a slight recovery in 2024, rising to 1.03, and remained stable at 1.03 in 2025.

Total Cash Assets

Total cash assets increased from US$11,152 million in 2021 to US$12,396 million in 2022. Growth continued, albeit at a slower pace, reaching US$12,683 million in 2023. A more significant increase was noted between 2023 and 2024, with cash assets reaching US$16,164 million. This upward trend persisted into 2025, with total cash assets reaching US$17,203 million.

Current Liabilities

Current liabilities demonstrated consistent growth throughout the period. They increased from US$6,246 million in 2021 to US$8,474 million in 2022. The rate of increase accelerated in 2023, reaching US$13,330 million. Further growth was observed in 2024, with current liabilities reaching US$15,647 million, and continued into 2025, reaching US$16,698 million.

The stabilization of the cash ratio in the final two years suggests that the growth in cash assets began to offset the increasing current liabilities. However, the ratio remains lower than its initial value in 2021, indicating a reduced, though still present, capacity to cover short-term obligations solely with cash.