NVIDIA Corp. (NASDAQ:NVDA)

Current Ratio Analysis

The current ratio exhibited a generally declining trend from April 2019 through July 2020, dropping from a high of 8.98 to 6.09. This was followed by a marked decrease reaching a low around October 2020 at 3.92. Subsequently, the ratio showed some recovery and fluctuations, peaking near 7.14 in October 2021 before entering another downward phase. From this point onward, the ratio remained in a moderate range, fluctuating mostly between approximately 3.4 and 4.5 with occasional minor dips and rises through July 2025. The oscillations indicate variability in short-term liquidity but no extreme liquidity crises.

Quick Ratio Analysis

Similarly, the quick ratio followed a decreasing pattern from 7.64 in April 2019 to a low point around 3.46 in October 2020. This decline suggests a reduction in liquid assets excluding inventory. Following this low, the quick ratio increased, reaching a peak of 6.44 in October 2021, before tapering off again. In subsequent quarters, it remained relatively stable in the 2.6 to 3.9 range, showing consistent but less robust liquidity excluding inventory. There is a visible correlation with the current ratio trends, reflecting consistent management of liquid assets relative to short-term liabilities.

Cash Ratio Analysis

The cash ratio showed a gradual decline from 6.6 in April 2019 to a trough near 2.76 in October 2020, reflecting reduced cash and cash equivalents relative to current liabilities during this period. This was followed by a rebound to 5.34 in October 2021, indicating an improved cash position. After this peak, the cash ratio steadily decreased and fluctuated between 1.5 and 2.5, demonstrating moderate cash reserves relative to obligations. The sustained lower levels post-2021 suggest a strategic adjustment toward maintaining lower cash buffers or increased current liabilities.

Overall Liquidity Trends

Across all three liquidity ratios—current, quick, and cash—there is a consistent pattern of high liquidity in early periods (2019), followed by significant declines culminating around late 2020. This period coincides with increased liquidity pressure or possible operational changes. Subsequent recovery to higher levels by late 2021 indicates strengthened liquidity positions after this dip. Post-2021, the company maintains moderate liquidity with some fluctuations but no return to peak levels seen in 2019 and early 2020. The trend indicates a cautious liquidity management approach, balancing available resources and obligations without maintaining overly high liquid asset levels.

Current assets

The current assets show a consistent upward trend over the analyzed periods. Starting from approximately $10.6 billion in April 2019, the value generally increased, with some fluctuations, reaching over $102 billion by July 2025. Notably, there was a significant jump between May 2021 and January 2024, where current assets approximately doubled, indicating a substantial accumulation of liquid or short-term resources.

Current liabilities

The current liabilities also increased over time but at a comparatively lower rate than current assets. Beginning around $1.2 billion in April 2019, current liabilities rose steadily with some variations, reaching about $24.3 billion by July 2025. There are periods of sharper increases, such as between April 2023 and July 2025, which may reflect growing obligations or short-term debts.

Current ratio

The current ratio fluctuated throughout the periods, reflecting changes in liquidity relative to short-term obligations. Initially, the ratio was very high at approximately 9.0 in April 2019, indicating strong liquidity. This ratio decreased to a range between 3.4 and 5.8 in later years, with occasional rebounds. The lowest points were noted around mid-2022 and early 2023, falling below 3.5, suggesting comparatively reduced liquidity coverage in those quarters. However, the ratio rebounded again to above 4 in the most recent periods, implying a restoration of stronger liquidity positions.

Summary of trends

Overall, the company has demonstrated significant growth in current assets, greatly outpacing the increase in current liabilities. This has generally supported a current ratio well above 3, indicating good short-term financial health and ability to cover current obligations. Despite some fluctuations, the liquidity position remains sound, and the rising levels of current assets suggest positive operational cash flows or asset management. The periods with lower current ratios may warrant further attention, but the recent upward trend is a positive indicator of improving liquidity.

The financial data reveals significant fluctuations in total quick assets, current liabilities, and the quick ratio over multiple quarters. A general upward trend is observed in total quick assets, which grow from US$ 9,044 million in April 2019 to US$ 84,599 million by July 2025. Despite some periods of decline, most notably around mid-2022 to early 2023, the overall trajectory is strongly positive, indicating increasing liquid assets available in the short term.

Current liabilities show an increasing trend as well, rising from US$ 1,183 million in April 2019 to US$ 24,257 million by July 2025. The growth is not linear, with fluctuations indicating varying short-term obligations across the quarters. Notably, current liabilities jump significantly in mid-2022 and again in the final observed years, suggesting growing obligations that may impact liquidity management.

The quick ratio, representing the company's ability to cover current liabilities with its quick assets, demonstrates considerable variability. Initially very high, above 7.6 in early 2019, it declines sharply to around 3.5 by late 2025. This downward trend mostly reflects the faster growth rate of current liabilities compared to quick assets, despite the absolute increase in quick assets. The ratio experiences intermittent recoveries, with peaks occurring around mid-2021 and early 2024, but the general direction indicates a tightening liquidity position relative to current liabilities over the analyzed period.

In summary, while the company shows strong growth in liquid assets, the rise in current liabilities outpaces it in relative terms, causing the quick ratio to decline from very high levels to a more moderate range. This suggests increasing short-term financial obligations and potentially greater liquidity risk that requires monitoring. However, the absolute amount of quick assets continues to strengthen, providing a buffer against these liabilities.

Total quick assets

Steady increase over time, rising from 9,044 to 84,599 million USD, with slight declines mid-2022 to early 2023.

Current liabilities

Increased significantly from 1,183 million USD to 24,257 million USD, with pronounced spikes after mid-2022.

Quick ratio

Decreased notably from around 7.6 to approximately 3.5, showing reduced coverage of liabilities by quick assets despite asset growth.

The financial data reveals significant fluctuations and underlying trends related to liquidity and short-term financial stability over the analyzed quarters.

Total Cash Assets

Total cash assets have shown a substantial overall growth trajectory despite some intermittent declines. Starting at approximately 7.8 billion US dollars in Q2 2019, cash reserves increased sharply, reaching a peak of about 25.9 billion US dollars by Q1 2024. There were dips observed around Q2 2022 to Q4 2022 where cash assets reduced from roughly 20.3 billion to 13.1 billion US dollars. However, the upward trend resumed strongly afterward, culminating in a cash position of nearly 56.8 billion US dollars by Q3 2025. This growth indicates an enhanced capacity to cover liabilities and invest in growth opportunities.

Current Liabilities

Current liabilities have also increased over the period but with more volatility than cash assets. Beginning at around 1.2 billion US dollars in Q2 2019, liabilities escalated substantially to peak near 26.5 billion US dollars in Q2 2025. Notable expansions occurred particularly from 2021 onwards, with spikes evident in Q3 2023 and again toward the later quarters in 2024 and 2025. The rise in current liabilities suggests a greater use of short-term obligations or operational scaling. Yet the growth in cash assets outpaces the liabilities, indicating maintained or improved liquidity buffers.

Cash Ratio

The cash ratio, representing cash assets relative to current liabilities, started very high above 6 in early periods, reflecting an exceptionally strong liquidity position. It declined over time, reaching its lowest points just below 1.6 in Q3 2023, which may indicate tighter liquidity relative to obligations during that timeframe. From that trough, the ratio stabilized and gradually increased again up to around 2.3 by mid-2025. This suggests an overall balance was retained between cash reserves and short-term liabilities despite growth in both, maintaining prudent liquidity management.

In summary, the data indicates robust growth in cash holdings with increasing current liabilities, accompanied by a generally healthy cash ratio. This points to effective liquidity management ensuring that current obligations are well covered by cash assets, even as the scale of business and short-term liabilities have expanded considerably during the analyzed period.