Qualcomm Inc. (NASDAQ:QCOM)

The financial data reveals notable fluctuations and trends in operational efficiency ratios over the indicated periods.

Inventory Turnover

This metric decreased from 3.56 in 2020 to a low of 2.47 in 2023, followed by a gradual recovery to 3.02 by 2025. This suggests a slowdown in inventory movement between 2020 and 2023, with some improvement in the subsequent years.

Receivables Turnover

Receivables turnover experienced significant volatility, peaking at 18.63 in 2023 after a sharp rise from 8.76 in 2020, and then gradually declining to 15.51 by 2025. This indicates periods of faster and slower collection cycles, with overall improvement compared to the initial year.

Payables Turnover

Payables turnover rose markedly from 4.12 in 2020 to 8.3 in 2023, indicating faster payments to suppliers, before slightly decreasing to 7.07 in 2025. The company appeared to accelerate its payments through 2023, then modestly slowed them down.

Working Capital Turnover

Working capital turnover increased significantly from 2.39 in 2020 to a peak of 4.99 in 2022, but then declined to stabilize around 2.65-2.67 in 2024 and 2025. This pattern reflects initially improved efficiency in generating sales from working capital, followed by a contraction to levels closer to the starting point.

Average Inventory Processing Period

Consistent with the inventory turnover trend, the average inventory processing period lengthened from 102 days in 2020 to a high of 148 days in 2023, followed by a steady decline to 121 days in 2025. This confirms slower inventory movement during the middle years, with partial improvement later.

Average Receivable Collection Period

This period shortened significantly from 42 days in 2020 to 20 days in 2023, then slightly extended to 24 days by 2025. The trend indicates enhanced efficiency in collecting receivables, maintaining improved collection speed compared to the initial years.

Operating Cycle

The operating cycle showed a lengthening trend from 144 days in 2020 up to 168 days in 2023, then shortened to 145 days by 2025. This suggests an initial extension in the total time to convert raw materials and receivables into cash, which later contracted closer to earlier levels.

Average Payables Payment Period

The average payables payment period decreased sharply from 89 days in 2020 to 44 days in 2023, then slightly increased to the low fifties in subsequent years. This indicates the company paid suppliers faster over time, especially peaking in 2023, before gradually elongating payment periods.

Cash Conversion Cycle

Reflecting the interplay of inventory, receivables, and payables periods, the cash conversion cycle dropped from 55 days in 2020 to 37 days in 2021, then surged to 124 days in 2023, before improving back to 93 days by 2025. This points to a temporary deterioration in overall cash flow efficiency, with recovery initiated in later years but not reaching initial performance levels.

Overall, the data reflect a period of operational challenges particularly around 2022-2023, characterized by slower inventory processing and extended cash conversion cycles, coupled with faster receivables collection and quicker payables payments during the same timeframe. Subsequent years show gradual rebalancing towards improved efficiency, although certain measures have yet to return fully to early-period standards.

Cost of Revenues

The cost of revenues shows an overall upward trend across the observed periods. Starting from $9,255 million, it increased significantly to $14,262 million the following year, continuing to rise to $18,635 million in the third year. Although there was a decline to $15,869 million in the fourth year, the subsequent two years saw another increase, reaching $19,738 million by the latest period. This pattern suggests fluctuating production or sales costs, with a general tendency towards higher expenses over time.

Inventories

Inventories experienced steady growth from $2,598 million initially to $3,228 million in the second year. A marked increase occurred in the third year, doubling inventories to $6,341 million. This elevated level of inventories remained relatively stable in the following years, with only slight increases, reaching $6,526 million in the most recent period. The sharp rise in inventories in the middle periods indicates accumulation of stock, which could be linked to anticipated demand or potential stockpiling strategies.

Inventory Turnover

The inventory turnover ratio decreased from 3.56 to 2.94 over the initial three periods, showing slower inventory movement relative to previous years. It reached a low point of 2.47 in the fourth year, indicating further slowdown. However, the ratio improved moderately after this trough, rising to 3.02 by the last reported period. The decline and subsequent partial recovery in this ratio suggest initial challenges in converting inventory to sales efficiently, with some evidence of operational improvement later on.

Revenues

Revenues demonstrate a general upward trend over the analyzed periods, increasing from approximately 23.5 billion USD in 2020 to nearly 44.3 billion USD projected for 2025. Notably, revenues rose sharply from 2020 to 2022, peaking at 44.2 billion USD in 2022, followed by a decline in 2023 to 35.8 billion USD. Subsequent years show a recovery with revenues estimated to grow again, reaching over 44 billion USD by 2025.

Accounts Receivable, Trade, Net of Allowances

The accounts receivable values display significant fluctuations. After a decrease from 2.7 billion USD in 2020 to 2.2 billion USD in 2021, there is a pronounced increase to 4.2 billion USD in 2022. This figure sharply falls again in 2023 to under 2 billion USD, followed by a gradual increase in the next two years, reaching close to 2.9 billion USD by 2025. These movements suggest changing collections or credit policies over time.

Receivables Turnover Ratio

The receivables turnover ratio indicates variability in the company's efficiency in collecting its trade receivables. Starting at 8.76 in 2020, the ratio spikes to 15.16 in 2021, then declines to 10.59 in 2022. It rises markedly to 18.63 in 2023, implying improved collection efficiency. This ratio slightly reduces in the following years, stabilizing around 15.5 by 2025. The fluctuations correspond inversely to the movements observed in accounts receivable balance.

Overall Insights

The revenue pattern shows an overall strong growth trajectory despite a temporary dip in 2023. The accounts receivable and receivables turnover data reflect dynamic changes in credit management or customer payment behaviors, with collection efficiency improving significantly in years where accounts receivable balances reduce markedly. These figures suggest active management attention to cash flow optimization. Monitoring the relationship between receivables and revenue is crucial to sustain financial health as revenues continue to increase.

The financial data over six fiscal years indicates several observable trends in cost of revenues, trade accounts payable, and the associated payables turnover ratio.

Cost of Revenues

The cost of revenues showed a general increasing trend from $9,255 million in 2020 to $19,738 million in 2025, with a notable peak in 2022 at $18,635 million followed by a decline in 2023 to $15,869 million and then a subsequent recovery in 2024 and 2025. This suggests fluctuating but overall growing production or service delivery costs, indicative of business expansion or inflationary cost pressures.

Trade Accounts Payable

Trade accounts payable fluctuated over the period, starting at $2,248 million in 2020, increasing to a high of $3,796 million in 2022, then dropping sharply to $1,912 million in 2023 before rising again in the subsequent two years to $2,791 million in 2025. This pattern could indicate variable supplier credit terms utilization or changes in purchasing strategies and cash management.

Payables Turnover Ratio

The payables turnover ratio displayed volatility, moving from 4.12 in 2020 up to 5.19 in 2021, then slightly declining to 4.91 in 2022. A significant increase occurred in 2023 to 8.3, followed by decreases to 6.6 in 2024 and 7.07 in 2025. The sharp rise in 2023 may reflect faster payment to suppliers or changes in purchasing volumes, while the subsequent moderation suggests a return toward more normalized payment cycles.

Overall, the data reflects growth in operational scale as demonstrated by rising costs, with mixed management of payables evidenced by fluctuating outstanding payables and turnover ratios. The peak and trough patterns in payables and turnover ratio highlight periods of varied liquidity management or supplier relationship strategies.

Working Capital

Working capital exhibited a generally increasing trajectory over the periods analyzed. Starting at $9,847 million, it declined to $8,124 million the following year but subsequently rebounded and grew steadily to reach $16,610 million by the last reported period. This upward trend suggests an improvement in the company’s short-term liquidity position after an initial decrease, indicating enhanced capacity to cover current liabilities with current assets over time.

Revenues

Revenues showed considerable fluctuations throughout the time frame. There was a strong growth phase from $23,531 million to $44,200 million in two years, peaking in the third period. This was followed by a notable decline to $35,820 million, then a recovery trend culminating at approximately $44,284 million. The revenue pattern indicates volatility with periods of significant expansion and contraction, implying sensitivity to market or operational factors influencing sales performance.

Working Capital Turnover Ratio

The working capital turnover ratio, which measures revenue generated per unit of working capital, initially increased sharply from 2.39 to 4.99, reflecting improved efficiency in using working capital to generate sales. However, after this peak, the ratio declined to around 2.65–2.79 in the most recent periods, suggesting that the growth in working capital outpaced revenue growth during these years. This decrease in turnover efficiency may imply either a strategic build-up of working capital or a less efficient utilization of current assets relative to sales.

Summary

Overall, the data reveal a company experiencing dynamic changes in both liquidity and revenue performance. The working capital improved significantly in absolute terms, signifying strengthened financial stability, while revenue displayed volatility but ended near its previous high point. Despite the rise in working capital, turnover ratio trends indicate a reduction in working capital efficiency after a peak, a factor warranting attention to optimize asset utilization relative to sales growth going forward.

Inventory Turnover

The inventory turnover ratio experienced fluctuations over the six-year period. It increased from 3.56 in 2020 to a peak of 4.42 in 2021, indicating an improvement in the efficiency of inventory management. However, this ratio declined in subsequent years, reaching a low of 2.47 in 2023. A modest recovery is observed thereafter, with the ratio moving up to 3.02 by 2025. This pattern suggests varying levels of inventory selling efficiency, with the most recent years showing a moderate improvement but not reaching the earlier peak.

Average Inventory Processing Period

The average inventory processing period, expressed in days, inversely reflects the inventory turnover trend. It shortened significantly from 102 days in 2020 to 83 days in 2021, indicative of faster inventory movement. Following this, the period lengthened sharply, peaking at 148 days in 2023, which corresponds to the lowest inventory turnover ratio in the same year. Subsequently, the processing period decreased to 121 days by 2025, aligning with the improvement in turnover. The data implies a period of slower inventory processing mid-cycle, with a partial return toward greater efficiency in recent periods.

Overall Insights

The analyzed financial metrics reveal a dynamic inventory management environment characterized by an initial improvement in turnover and processing speed, followed by a substantial slowdown, and concluding with signs of recovery. This suggests potential operational challenges mid-period that may have impacted inventory liquidity and operational efficiency, with corrective measures likely contributing to the recent positive trends.

Receivables Turnover

The receivables turnover ratio exhibits significant fluctuations over the analyzed periods. Starting at 8.76 in 2020, it rose sharply to 15.16 in 2021, indicating a more efficient collection of receivables. This was followed by a decline to 10.59 in 2022, suggesting a temporary decrease in collection efficiency. However, the ratio rebounded to 18.63 in 2023, which represents the highest efficiency in collecting receivables during the years observed. The ratio then moderately declined to 16.6 in 2024 and further to 15.51 in 2025, indicating a slight reduction in collection efficiency but still maintaining higher levels compared to the initial years.

Average Receivable Collection Period

The average receivable collection period inversely reflects the trends seen in the receivables turnover ratio. Initially, it was relatively high at 42 days in 2020, indicating slower collections. This figure significantly decreased to 24 days in 2021, aligning with improved collection efficiency. Thereafter, it increased to 34 days in 2022, implying a slowdown in collections. The period then shortened considerably to 20 days in 2023, indicating the fastest collection pace across the periods analyzed. This was followed by a slight increase to 22 days in 2024 and 24 days in 2025, maintaining a generally low average collection period compared to the earlier years.

Overall Insights

Overall, the data reveal an improving trend in receivables management from 2020 through 2025, with increased efficiency particularly notable in 2021 and 2023. There are oscillations in both turnover and collection period metrics, but the general pattern suggests enhanced receivables control and faster cash conversion cycles in recent years compared to the starting point. The company appears to have strengthened its credit and collection policies, leading to improved liquidity reflected in these ratios.

Average Inventory Processing Period

The average inventory processing period shows a variable trend over the analyzed years. Initially, there is a decrease from 102 days in 2020 to 83 days in 2021, indicating improved inventory turnover efficiency. However, this is followed by a significant increase to 124 days in 2022 and further lengthening to a peak of 148 days in 2023. In the subsequent years, the period decreases somewhat to 137 days in 2024 and further to 121 days in 2025, but it remains above the initial 2020 level. This suggests some challenges or changes in inventory management impacting turnover time.

Average Receivable Collection Period

The average receivable collection period exhibits a fluctuating but overall declining trend compared to the start of the period. It starts at 42 days in 2020, sharply decreases to 24 days in 2021, rises slightly to 34 days in 2022, then drops again to 20 days in 2023. The last two years show a modest increase to 22 days in 2024 and 24 days in 2025. This pattern indicates efforts to optimize the collection process, with generally improved efficiency in receivables management over time despite some volatility.

Operating Cycle

The operating cycle reflects the combined effect of inventory processing and receivable collection. It decreases from 144 days in 2020 to 107 days in 2021, which corresponds with improvements in both inventory turnover and receivable collections during that period. However, from 2022 onwards, the operating cycle lengthens sharply to 158 days, then peaks at 168 days in 2023. Thereafter, it declines to 159 days in 2024 and further to 145 days in 2025. This indicates a return towards more efficient overall operations but still longer cycles compared to the initial years, suggesting continuing challenges in balancing inventory and receivables turnover.

The analysis of the payables turnover and average payables payment period over the observed years reflects notable fluctuations in the company's payment management efficiency.

Payables Turnover

The payables turnover ratio exhibits varying trends. Starting at 4.12 in 2020, it increased to 5.19 in 2021, indicating faster payments to suppliers compared to the previous year. This was followed by a slight decline to 4.91 in 2022. A significant spike to 8.3 in 2023 suggests a substantial acceleration in payment frequency, improving the turnover markedly. In the subsequent years, the ratio moderated to 6.6 in 2024 and slightly increased again to 7.07 in 2025. Overall, the pattern highlights a generally improved capability to pay off payables more frequently in recent years, with a peak in 2023.

Average Payables Payment Period (in days)

The average payment period decreased from 89 days in 2020 to 70 days in 2021, confirming quicker payment cycles. This period slightly lengthened to 74 days in 2022 but subsequently dropped sharply to 44 days in 2023. The improvement seen in 2023 aligns with the peak in payables turnover ratio, indicating a strategic move towards faster payables settlement. The payment period increased moderately to 55 days in 2024 and then slightly reduced to 52 days in 2025. The fluctuations suggest adjustments in cash management or supplier negotiations, ultimately reflecting improved liquidity management compared to the initial year.

In summary, both metrics denote enhanced efficiency in payables management over the long term, with the most notable improvements occurring around 2023. The data imply a strategic emphasis on accelerating payments, potentially to strengthen supplier relationships or optimize working capital utilization.

Average Inventory Processing Period

The average inventory processing period shows a fluctuating trend over the examined years. It initially decreased from 102 days to 83 days, suggesting improved inventory turnover. However, it subsequently increased significantly to 124 days and peaked at 148 days, indicating slower inventory movement during that period. More recently, it decreased to 137 days and then further to 121 days, showing partial recovery but remaining elevated compared to the initial years.

Average Receivable Collection Period

This period demonstrates a generally declining trend, moving from 42 days down to 24 days by the end of the period. A notable drop occurred between the first and second years, improving receivables management and cash inflows. Although some minor increases are observed in later periods, the overall trend indicates enhanced efficiency in collecting receivables.

Average Payables Payment Period

The average payables payment period decreased steadily from 89 days to 70 days and then slightly increased to 74 days. It experienced a sharp decline to 44 days thereafter, which could imply faster payment to suppliers during that year. Following that, it rose moderately to 55 days and then slightly declined to 52 days. This variability might reflect changes in payment policies or supplier negotiations.

Cash Conversion Cycle

The cash conversion cycle initially improved, dropping from 55 days to 37 days, indicating an overall faster conversion of inventory and receivables into cash. However, this trend reversed subsequently, with the cycle increasing sharply to 84 days and then reaching a peak of 124 days, reflecting slower liquidity turnover. The cycle then reduced to 104 days and further to 93 days in the latest year, which suggests some improvements in cash flow efficiency but still above the earliest levels.