Qualcomm Inc. (NASDAQ:QCOM)

The financial ratios presented indicate the company’s liquidity position over several years. The trends observed reflect changes in the company's ability to meet short-term obligations.

Current Ratio

The current ratio shows an overall increasing trend from 2.14 in 2020 to 2.82 in 2025. There was a decline in 2021 to 1.68, followed by a slight recovery to 1.75 in 2022. From 2023 onwards, the ratio improved steadily, reaching its highest point in 2025. This indicates a generally strengthening short-term financial health and growing capability to cover current liabilities with current assets over time.

Quick Ratio

The quick ratio also exhibited a downward movement initially, declining from 1.75 in 2020 to 1.01 in 2022, indicating a reduction in liquid assets excluding inventories relative to current liabilities during this period. However, from 2023, the ratio improved to 1.51 and continued to rise to 1.84 by 2025. This suggests that after a period of diminished immediate liquidity, the company enhanced its position concerning more liquid assets.

Cash Ratio

The cash ratio trend mirrors that of the quick ratio, starting at 1.29 in 2020 and dropping to a low of 0.54 in 2022, which implies a significant temporary decline in cash and cash equivalents available relative to current liabilities. Post-2022, there was a recovery with the ratio increasing to 1.18 in 2023 and continuing upward to 1.36 in 2025. This improvement reflects a rebound in cash reserves, enhancing the company's ability to cover short-term debts immediately with cash itself.

In summary, the liquidity ratios depict an initial period of decreasing liquidity from 2020 through 2022, with the most pronounced decline observed in the cash ratio. From 2023 forward, the company shows a clear recovery and strengthening of liquidity positions, indicating enhanced financial cushioning and better management of liquid resources relative to current liabilities.

Current Assets

Current assets show a consistent upward trend throughout the periods analyzed. Starting at 18,519 million US dollars, current assets increased steadily each year, reaching 25,754 million US dollars by the last period. This trend indicates an expanding base of liquid and short-term assets available to the company.

Current Liabilities

The current liabilities exhibit some variability over the years. They rose significantly from 8,672 million US dollars to a peak of 11,951 million US dollars in the second period, followed by slight decreases and increases, ultimately declining to 9,144 million US dollars in the most recent period. This pattern suggests some fluctuations in the company's short-term obligations, with a general decline in liabilities in the latter years.

Current Ratio

The current ratio, which measures the company's ability to cover short-term liabilities with short-term assets, fluctuated initially but overall demonstrated a positive upward trajectory. It declined from 2.14 to 1.68 in the second period, then gradually increased to 2.82 by the final period. The rising trend, especially in the last few years, implies strengthening liquidity and an improving capacity to meet short-term financial obligations.

Total Quick Assets

Total quick assets exhibited fluctuations over the observed periods, beginning at 15,217 million US dollars and reaching a low point of 12,025 million in 2022. Subsequently, there was an upward trend, culminating in a peak of 17,229 million in 2024, followed by a slight decrease to 16,793 million in 2025. This indicates variability in highly liquid assets but an overall positive growth trend towards the latter years.

Current Liabilities

Current liabilities showed significant volatility, increasing sharply from 8,672 million to 11,951 million between 2020 and 2021, stabilizing around 11,866 million in 2022, then declining to 9,628 million in 2023. After a modest rise in 2024 to 10,504 million, liabilities decreased again to 9,144 million in 2025. This pattern suggests active management of short-term obligations with a downward tendency in recent years.

Quick Ratio

The quick ratio experienced a marked decline from 1.75 in 2020 to 1.01 in 2022, indicating a reduced ability to cover current liabilities with quick assets during this period. After 2022, the ratio improved steadily, rising to 1.51 in 2023, 1.64 in 2024, and achieving its highest value of 1.84 in 2025. This upward correction reflects an enhanced liquidity position and stronger short-term financial health toward the end of the timeframe.

Summary

Overall, the financial indicators reveal a period of contraction in liquid assets and liquidity from 2020 through 2022, followed by a recovery phase with increased quick assets, decreased current liabilities, and an improved quick ratio. The trends suggest effective liquidity management efforts and an enhanced capacity to meet short-term liabilities in the most recent periods.

Total Cash Assets

Over the analyzed periods, total cash assets demonstrated variability with notable fluctuations. The values started at a high level, followed by a significant decline observed in the third period. Subsequently, a recovery trend is evident with a peak reached in the fifth period, before a slight decrease in the final period. This pattern suggests episodic changes in liquidity reserves that may be linked to operational or investment activities.

Current Liabilities

Current liabilities show a general increase from the first to the second period, reaching their highest value in the second period. From the third period onward, there is a downward trend, albeit with some minor fluctuations, resulting in the lowest value in the final period. This decline after the peak may indicate efforts to reduce short-term obligations, enhancing financial stability.

Cash Ratio

The cash ratio, reflecting the company's immediate liquidity, correlates with the movements of total cash assets and current liabilities. It begins at a strong level above 1.0, declines significantly in the third period to nearly half the initial ratio, then recovers and improves steadily in the subsequent periods, achieving the highest ratio in the last period. This improvement demonstrates enhanced capacity to cover current liabilities solely with cash holdings over time.