Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Based on: 10-K (reporting date: 2024-09-29), 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29).
The analysis of liquidity ratios over the six-year period reveals notable trends in the company's short-term financial health and its ability to meet immediate obligations.
- Current Ratio
- The current ratio exhibits fluctuations but maintains an overall upward trajectory from 1.88 in 2019 to 2.40 in 2024. It peaked at 2.33 in 2023 after a dip to 1.68 in 2021. This progression suggests an improving capacity to cover current liabilities with current assets, reaching its highest level in the most recent year.
- Quick Ratio
- The quick ratio shows more variability, declining sharply from 1.75 in 2020 to 1.01 in 2022 before rising again to 1.64 in 2024. This indicates that liquid assets excluding inventory weakened in the middle years but improved considerably afterward. The improvement in the last two years suggests enhanced liquidity without relying on inventory.
- Cash Ratio
- The cash ratio follows a similar pattern to the quick ratio, decreasing steadily from 1.37 in 2019 to a low of 0.54 in 2022, before recovering to 1.27 in 2024. This pattern highlights that cash and cash equivalents were at their lowest relative to current liabilities in 2022 but improved significantly afterward, nearing the initial levels of 2019 by 2024.
In summary, the data indicates a temporary weakening in liquidity ratios, particularly in quick and cash ratios between 2020 and 2022, followed by a notable recovery through 2024. The increasing current ratio throughout the period reflects a growing cushion of current assets over current liabilities, while the recovery in cash-based liquidity ratios in the latest years reflects strengthening immediate financial readiness.
Current Ratio
Sep 29, 2024 | Sep 24, 2023 | Sep 25, 2022 | Sep 26, 2021 | Sep 27, 2020 | Sep 29, 2019 | ||
---|---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | |||||||
Current assets | 25,231) | 22,464) | 20,724) | 20,075) | 18,519) | 16,765) | |
Current liabilities | 10,504) | 9,628) | 11,866) | 11,951) | 8,672) | 8,935) | |
Liquidity Ratio | |||||||
Current ratio1 | 2.40 | 2.33 | 1.75 | 1.68 | 2.14 | 1.88 | |
Benchmarks | |||||||
Current Ratio, Competitors2 | |||||||
Advanced Micro Devices Inc. | 2.62 | 2.51 | 2.36 | 2.02 | 2.54 | — | |
Analog Devices Inc. | 1.84 | 1.37 | 2.02 | 1.94 | 1.84 | 1.32 | |
Applied Materials Inc. | 2.51 | 2.60 | 2.16 | 2.54 | 3.00 | 2.30 | |
Broadcom Inc. | 1.17 | 2.82 | 2.62 | 2.64 | 1.87 | 1.44 | |
Intel Corp. | 1.33 | 1.54 | 1.57 | 2.10 | 1.91 | — | |
KLA Corp. | 2.15 | 2.24 | 2.50 | 2.71 | 2.78 | 2.44 | |
Lam Research Corp. | 2.97 | 3.16 | 2.69 | 3.30 | 3.43 | 3.61 | |
Micron Technology Inc. | 2.64 | 4.46 | 2.89 | 3.10 | 2.71 | 2.58 | |
NVIDIA Corp. | 4.17 | 3.52 | 6.65 | 4.09 | 7.67 | — | |
Texas Instruments Inc. | 4.12 | 4.55 | 4.70 | 5.33 | 4.28 | — | |
Current Ratio, Sector | |||||||
Semiconductors & Semiconductor Equipment | 2.14 | 2.45 | 2.34 | 2.47 | 2.47 | — | |
Current Ratio, Industry | |||||||
Information Technology | 1.24 | 1.41 | 1.37 | 1.55 | 1.71 | — |
Based on: 10-K (reporting date: 2024-09-29), 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29).
1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= 25,231 ÷ 10,504 = 2.40
2 Click competitor name to see calculations.
- Current Assets
- Current assets exhibit a consistent upward trend from 2019 to 2024, increasing from approximately $16.8 billion to $25.2 billion. This steady growth indicates an ongoing accumulation of short-term resources available to meet operational needs.
- Current Liabilities
- Current liabilities fluctuate over the period. Starting at around $8.9 billion in 2019, liabilities decrease slightly in 2020, then sharply increase to nearly $12.0 billion in 2021 and remain at a comparable level in 2022 before decreasing to $9.6 billion in 2023. There is a moderate increase again in 2024 to approximately $10.5 billion. This volatility suggests varying short-term obligations and possible adjustments in working capital management.
- Current Ratio
- The current ratio remains above 1.5 throughout the period, showing overall strong liquidity. It improves from 1.88 in 2019 to a peak of 2.14 in 2020, declines to 1.68 in 2021, and then gradually increases again to reach 2.4 by 2024. This pattern reflects changes in the balance between current assets and liabilities, indicating increased liquidity strength particularly from 2023 onwards.
Quick Ratio
Sep 29, 2024 | Sep 24, 2023 | Sep 25, 2022 | Sep 26, 2021 | Sep 27, 2020 | Sep 29, 2019 | ||
---|---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | |||||||
Cash and cash equivalents | 7,849) | 8,450) | 2,773) | 7,116) | 6,707) | 11,839) | |
Marketable securities | 5,451) | 2,874) | 3,609) | 5,298) | 4,507) | 421) | |
Accounts receivable, net | 3,929) | 3,183) | 5,643) | 3,579) | 4,003) | 2,471) | |
Total quick assets | 17,229) | 14,507) | 12,025) | 15,993) | 15,217) | 14,731) | |
Current liabilities | 10,504) | 9,628) | 11,866) | 11,951) | 8,672) | 8,935) | |
Liquidity Ratio | |||||||
Quick ratio1 | 1.64 | 1.51 | 1.01 | 1.34 | 1.75 | 1.65 | |
Benchmarks | |||||||
Quick Ratio, Competitors2 | |||||||
Advanced Micro Devices Inc. | 1.66 | 1.67 | 1.57 | 1.49 | 1.81 | — | |
Analog Devices Inc. | 1.24 | 0.76 | 1.34 | 1.24 | 1.31 | 0.85 | |
Applied Materials Inc. | 1.74 | 1.63 | 1.17 | 1.64 | 1.95 | 1.38 | |
Broadcom Inc. | 0.82 | 2.34 | 2.18 | 2.27 | 1.56 | 1.21 | |
Intel Corp. | 0.72 | 1.01 | 1.01 | 1.38 | 1.24 | — | |
KLA Corp. | 1.36 | 1.33 | 1.57 | 1.81 | 1.82 | 1.54 | |
Lam Research Corp. | 1.93 | 1.95 | 1.72 | 2.11 | 2.22 | 2.16 | |
Micron Technology Inc. | 1.59 | 2.53 | 1.92 | 2.17 | 1.82 | 1.74 | |
NVIDIA Corp. | 3.38 | 2.61 | 5.96 | 3.56 | 7.04 | — | |
Texas Instruments Inc. | 2.55 | 3.12 | 3.67 | 4.45 | 3.34 | — | |
Quick Ratio, Sector | |||||||
Semiconductors & Semiconductor Equipment | 1.42 | 1.63 | 1.62 | 1.79 | 1.78 | — | |
Quick Ratio, Industry | |||||||
Information Technology | 0.96 | 1.12 | 1.08 | 1.30 | 1.46 | — |
Based on: 10-K (reporting date: 2024-09-29), 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29).
1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 17,229 ÷ 10,504 = 1.64
2 Click competitor name to see calculations.
The analysis of the financial data over the six-year period reveals several key trends and fluctuations in the liquidity position of the company.
- Total Quick Assets
- The total quick assets, measured in millions of US dollars, exhibit a general upward trend from 14,731 in 2019 to 17,229 in 2024. Despite this overall increase, a notable dip occurs in 2022, when quick assets decrease to 12,025 from 15,993 in 2021. After this decline, quick assets recover significantly in the subsequent years, reaching their highest level in 2024.
- Current Liabilities
- Current liabilities fluctuate throughout the period without a clear directional trend. Starting at 8,935 million in 2019, they slightly decrease to 8,672 million in 2020, then rise sharply to 11,951 million in 2021. In the following year, 2022, the liabilities remain relatively stable at 11,866 million before decreasing to 9,628 million in 2023 and rising again to 10,504 million in 2024. This volatility indicates variability in short-term obligations during the timeframe.
- Quick Ratio
- The quick ratio demonstrates considerable variation over the years. Initially, it increases from 1.65 in 2019 to 1.75 in 2020, indicative of an improved liquidity position. However, the ratio then decreases markedly to 1.34 in 2021 and further declines to nearly unity at 1.01 in 2022. This drop suggests a tightening liquidity situation during 2021 and 2022. Following this low point, the quick ratio improves substantially in 2023 and 2024, reaching 1.51 and 1.64 respectively, reflective of strengthened short-term financial health.
In summary, the data reflect a period of fluctuating liquidity, with a notable weakening around 2021-2022, as evidenced by decreased quick assets and a drop in the quick ratio to near 1. This period coincides with peak current liabilities. The subsequent recovery in both quick assets and quick ratio suggests a restoration of liquidity strength by 2024. Overall, the company appears to have managed its short-term assets and liabilities dynamically in response to evolving financial conditions.
Cash Ratio
Sep 29, 2024 | Sep 24, 2023 | Sep 25, 2022 | Sep 26, 2021 | Sep 27, 2020 | Sep 29, 2019 | ||
---|---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | |||||||
Cash and cash equivalents | 7,849) | 8,450) | 2,773) | 7,116) | 6,707) | 11,839) | |
Marketable securities | 5,451) | 2,874) | 3,609) | 5,298) | 4,507) | 421) | |
Total cash assets | 13,300) | 11,324) | 6,382) | 12,414) | 11,214) | 12,260) | |
Current liabilities | 10,504) | 9,628) | 11,866) | 11,951) | 8,672) | 8,935) | |
Liquidity Ratio | |||||||
Cash ratio1 | 1.27 | 1.18 | 0.54 | 1.04 | 1.29 | 1.37 | |
Benchmarks | |||||||
Cash Ratio, Competitors2 | |||||||
Advanced Micro Devices Inc. | 0.70 | 0.86 | 0.92 | 0.85 | 0.95 | — | |
Analog Devices Inc. | 0.79 | 0.30 | 0.60 | 0.71 | 0.77 | 0.43 | |
Applied Materials Inc. | 1.12 | 0.93 | 0.35 | 0.86 | 1.29 | 0.81 | |
Broadcom Inc. | 0.56 | 1.92 | 1.76 | 1.94 | 1.20 | 0.73 | |
Intel Corp. | 0.62 | 0.89 | 0.88 | 1.03 | 0.97 | — | |
KLA Corp. | 0.97 | 0.87 | 0.94 | 1.19 | 1.17 | 0.98 | |
Lam Research Corp. | 1.35 | 1.28 | 0.77 | 1.25 | 1.55 | 1.54 | |
Micron Technology Inc. | 0.88 | 2.01 | 1.24 | 1.34 | 1.23 | 1.24 | |
NVIDIA Corp. | 2.44 | 2.03 | 4.89 | 2.95 | 6.11 | — | |
Texas Instruments Inc. | 2.08 | 2.58 | 3.04 | 3.79 | 2.75 | — | |
Cash Ratio, Sector | |||||||
Semiconductors & Semiconductor Equipment | 1.00 | 1.23 | 1.15 | 1.30 | 1.32 | — | |
Cash Ratio, Industry | |||||||
Information Technology | 0.57 | 0.71 | 0.66 | 0.88 | 1.06 | — |
Based on: 10-K (reporting date: 2024-09-29), 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29).
1 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 13,300 ÷ 10,504 = 1.27
2 Click competitor name to see calculations.
- Total Cash Assets
- The total cash assets experienced fluctuations over the given periods. Beginning at $12,260 million in 2019, a slight decrease was seen in 2020 to $11,214 million, followed by an increase to $12,414 million in 2021. In 2022, there was a significant decline to $6,382 million, representing nearly a 49% reduction from the previous year. However, the amount rebounded in 2023 to $11,324 million and further increased to $13,300 million in 2024, surpassing the initial 2019 value.
- Current Liabilities
- Current liabilities showed an overall increasing trend despite some variations. Starting at $8,935 million in 2019, there was a slight decrease in 2020 to $8,672 million. Then, a notable rise occurred in 2021 reaching $11,951 million, followed by a marginal increase to $11,866 million in 2022. In 2023, liabilities decreased to $9,628 million but rose again in 2024 to $10,504 million. The data indicate elevated liabilities compared to the initial years, with some volatility in the middle periods.
- Cash Ratio
- The cash ratio followed a trend generally consistent with the fluctuations in cash assets and current liabilities. It started at 1.37 in 2019 and declined slightly to 1.29 in 2020. A more pronounced decrease occurred in 2021 to 1.04, followed by a sharp drop to 0.54 in 2022, marking the lowest liquidity position within the observed timeframe. Recovery was noted in subsequent years with the ratio increasing to 1.18 in 2023 and further to 1.27 in 2024. This indicates an improvement in liquidity but not quite reaching the earliest levels by 2022's sharp decline.