Microsoft Excel LibreOffice Calc

Texas Instruments Inc. (NASDAQ:TXN)

Analysis of Short-term (Operating) Activity Ratios

Beginner level

Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.

Short-term Activity Ratios (Summary)

Texas Instruments Inc., short-term (operating) activity ratios

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Turnover Ratios
Inventory turnover 2.61 2.48 2.73 2.87 3.22
Receivables turnover 13.39 13.08 11.71 10.55 11.16
Payables turnover 13.45 11.52 11.47 12.95 14.09
Working capital turnover 2.17 2.81 2.31 2.57 2.88
Average No. Days
Average inventory processing period 140 147 134 127 113
Add: Average receivable collection period 27 28 31 35 33
Operating cycle 167 175 165 162 146
Less: Average payables payment period 27 32 32 28 26
Cash conversion cycle 140 143 133 134 120

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

Short-term activity ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Texas Instruments Inc.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.
Receivables turnover An activity ratio equal to revenue divided by receivables. Texas Instruments Inc.’s receivables turnover ratio improved from 2017 to 2018 and from 2018 to 2019.
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Texas Instruments Inc.’s payables turnover ratio increased from 2017 to 2018 and from 2018 to 2019.
Working capital turnover An activity ratio calculated as revenue divided by working capital. Texas Instruments Inc.’s working capital turnover ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.
Short-term activity ratio Description The company
Average inventory processing period An activity ratio equal to the number of days in the period divided by inventory turnover over the period. Texas Instruments Inc.’s number of days of inventory outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. Texas Instruments Inc.’s number of days of receivables outstanding improved from 2017 to 2018 and from 2018 to 2019.
Operating cycle Equal to average inventory processing period plus average receivables collection period. Texas Instruments Inc.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.
Average payables payment period An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period.
Cash conversion cycle A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. Texas Instruments Inc.’s cash conversion cycle deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019.

Inventory Turnover

Texas Instruments Inc., inventory turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Cost of revenue (COR) 5,219  5,507  5,347  5,130  5,440 
Inventories 2,001  2,217  1,957  1,790  1,691 
Short-term Activity Ratio
Inventory turnover1 2.61 2.48 2.73 2.87 3.22
Benchmarks
Inventory Turnover, Competitors2
Advanced Micro Devices Inc. 3.93 4.77 4.74 4.36 4.29
Apple Inc. 39.40 41.39 29.05 61.62 59.64
Applied Materials Inc. 2.37 2.54 2.73 3.08 3.11
Broadcom Inc. 11.57 9.00 6.31 5.21 6.24
Cisco Systems Inc. 13.91 10.14 11.00 15.03 11.97
Intel Corp. 3.41 3.74 3.39 4.18 4.00
Micron Technology Inc. 2.48 3.48 3.81 3.42 4.69
NVIDIA Corp. 2.89 4.89 3.59 5.26 4.31
Qualcomm Inc. 6.14 6.05 4.81 6.27 6.96
Inventory Turnover, Sector
Technology Hardware & Equipment 8.91 9.81 8.80 10.97 12.15
Inventory Turnover, Industry
Technology 12.91 13.04 11.93 14.19 14.37

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Inventory turnover = Cost of revenue (COR) ÷ Inventories
= 5,219 ÷ 2,001 = 2.61

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Texas Instruments Inc.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.

Receivables Turnover

Texas Instruments Inc., receivables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Revenue 14,383  15,784  14,961  13,370  13,000 
Accounts receivable, net of allowances 1,074  1,207  1,278  1,267  1,165 
Short-term Activity Ratio
Receivables turnover1 13.39 13.08 11.71 10.55 11.16
Benchmarks
Receivables Turnover, Competitors2
Advanced Micro Devices Inc. 3.62 5.24 13.32 13.74 7.49
Apple Inc. 11.35 11.45 12.82 13.69 13.87
Applied Materials Inc. 5.77 6.73 6.22 4.75 5.55
Broadcom Inc. 6.93 6.27 7.20 6.07 6.70
Cisco Systems Inc. 9.45 8.88 9.33 8.42 9.20
Intel Corp. 9.40 10.54 11.19 12.66 11.56
Micron Technology Inc. 8.43 6.01 5.82 7.02 7.40
NVIDIA Corp. 8.23 7.68 8.37 9.92 9.88
Qualcomm Inc. 23.21 7.98 6.23 10.74 13.02
Receivables Turnover, Sector
Technology Hardware & Equipment 10.03 9.61 10.28 11.06 11.59
Receivables Turnover, Industry
Technology 7.50 7.59 7.76 8.15 8.71

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Receivables turnover = Revenue ÷ Accounts receivable, net of allowances
= 14,383 ÷ 1,074 = 13.39

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Receivables turnover An activity ratio equal to revenue divided by receivables. Texas Instruments Inc.’s receivables turnover ratio improved from 2017 to 2018 and from 2018 to 2019.

Payables Turnover

Texas Instruments Inc., payables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Cost of revenue (COR) 5,219  5,507  5,347  5,130  5,440 
Accounts payable 388  478  466  396  386 
Short-term Activity Ratio
Payables turnover1 13.45 11.52 11.47 12.95 14.09
Benchmarks
Payables Turnover, Competitors2
Advanced Micro Devices Inc. 3.91 7.63 9.13 7.44 10.43
Apple Inc. 3.50 2.93 2.88 3.52 3.95
Applied Materials Inc. 8.58 9.47 8.47 7.77 8.67
Broadcom Inc. 11.83 12.47 8.26 5.79 5.30
Cisco Systems Inc. 9.34 9.83 12.84 17.32 17.64
Intel Corp. 7.23 7.09 8.09 9.37 10.02
Micron Technology Inc. 7.58 7.39 8.92 8.34 10.76
NVIDIA Corp. 8.89 6.53 5.87 7.43 7.10
Qualcomm Inc. 6.29 5.61 4.97 5.25 7.98
Payables Turnover, Sector
Technology Hardware & Equipment 4.46 3.87 3.88 4.60 5.11
Payables Turnover, Industry
Technology 5.49 4.77 4.77 5.39 5.70

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Payables turnover = Cost of revenue (COR) ÷ Accounts payable
= 5,219 ÷ 388 = 13.45

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Texas Instruments Inc.’s payables turnover ratio increased from 2017 to 2018 and from 2018 to 2019.

Working Capital Turnover

Texas Instruments Inc., working capital turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Current assets 8,761  8,097  8,734  7,457  7,074 
Less: Current liabilities 2,123  2,474  2,258  2,264  2,555 
Working capital 6,638  5,623  6,476  5,193  4,519 
 
Revenue 14,383  15,784  14,961  13,370  13,000 
Short-term Activity Ratio
Working capital turnover1 2.17 2.81 2.31 2.57 2.88
Benchmarks
Working Capital Turnover, Competitors2
Advanced Micro Devices Inc. 3.01 4.16 4.69 3.61 4.35
Apple Inc. 4.56 18.35 8.24 7.74 26.66
Applied Materials Inc. 2.54 2.58 1.65 2.29 1.77
Broadcom Inc. 7.49 3.08 1.33 3.27 2.57
Cisco Systems Inc. 3.24 1.42 0.86 0.92 0.93
Intel Corp. 8.06 5.83 5.20 3.91 2.24
Micron Technology Inc. 2.31 2.95 2.85 2.66 3.45
NVIDIA Corp. 1.27 1.20 1.02 1.35 0.97
Qualcomm Inc. 3.10 3.70 0.68 1.50 1.58
Working Capital Turnover, Sector
Technology Hardware & Equipment 3.95 4.77 2.57 2.99 3.34
Working Capital Turnover, Industry
Technology 2.41 2.23 1.72 1.90 2.12

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Working capital turnover = Revenue ÷ Working capital
= 14,383 ÷ 6,638 = 2.17

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Working capital turnover An activity ratio calculated as revenue divided by working capital. Texas Instruments Inc.’s working capital turnover ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Average Inventory Processing Period

Texas Instruments Inc., average inventory processing period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data
Inventory turnover 2.61 2.48 2.73 2.87 3.22
Short-term Activity Ratio (no. days)
Average inventory processing period1 140 147 134 127 113
Benchmarks (no. days)
Average Inventory Processing Period, Competitors2
Advanced Micro Devices Inc. 93 77 77 84 85
Apple Inc. 9 9 13 6 6
Applied Materials Inc. 154 144 134 119 117
Broadcom Inc. 32 41 58 70 58
Cisco Systems Inc. 26 36 33 24 30
Intel Corp. 107 98 108 87 91
Micron Technology Inc. 147 105 96 107 78
NVIDIA Corp. 126 75 102 69 85
Qualcomm Inc. 59 60 76 58 52
Average Inventory Processing Period, Sector
Technology Hardware & Equipment 41 37 41 33 30
Average Inventory Processing Period, Industry
Technology 28 28 31 26 25

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 2.61 = 140

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Average inventory processing period An activity ratio equal to the number of days in the period divided by inventory turnover over the period. Texas Instruments Inc.’s number of days of inventory outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.

Average Receivable Collection Period

Texas Instruments Inc., average receivable collection period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data
Receivables turnover 13.39 13.08 11.71 10.55 11.16
Short-term Activity Ratio (no. days)
Average receivable collection period1 27 28 31 35 33
Benchmarks (no. days)
Average Receivable Collection Period, Competitors2
Advanced Micro Devices Inc. 101 70 27 27 49
Apple Inc. 32 32 28 27 26
Applied Materials Inc. 63 54 59 77 66
Broadcom Inc. 53 58 51 60 55
Cisco Systems Inc. 39 41 39 43 40
Intel Corp. 39 35 33 29 32
Micron Technology Inc. 43 61 63 52 49
NVIDIA Corp. 44 48 44 37 37
Qualcomm Inc. 16 46 59 34 28
Average Receivable Collection Period, Sector
Technology Hardware & Equipment 36 38 35 33 31
Average Receivable Collection Period, Industry
Technology 49 48 47 45 42

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 13.39 = 27

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. Texas Instruments Inc.’s number of days of receivables outstanding improved from 2017 to 2018 and from 2018 to 2019.

Operating Cycle

Texas Instruments Inc., operating cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data
Average inventory processing period 140 147 134 127 113
Average receivable collection period 27 28 31 35 33
Short-term Activity Ratio
Operating cycle1 167 175 165 162 146
Benchmarks
Operating Cycle, Competitors2
Advanced Micro Devices Inc. 194 147 104 111 134
Apple Inc. 41 41 41 33 32
Applied Materials Inc. 217 198 193 196 183
Broadcom Inc. 85 99 109 130 113
Cisco Systems Inc. 65 77 72 67 70
Intel Corp. 146 133 141 116 123
Micron Technology Inc. 190 166 159 159 127
NVIDIA Corp. 170 123 146 106 122
Qualcomm Inc. 75 106 135 92 80
Operating Cycle, Sector
Technology Hardware & Equipment 77 75 76 66 61
Operating Cycle, Industry
Technology 77 76 78 71 67

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 140 + 27 = 167

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Operating cycle Equal to average inventory processing period plus average receivables collection period. Texas Instruments Inc.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.

Average Payables Payment Period

Texas Instruments Inc., average payables payment period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data
Payables turnover 13.45 11.52 11.47 12.95 14.09
Short-term Activity Ratio (no. days)
Average payables payment period1 27 32 32 28 26
Benchmarks (no. days)
Average Payables Payment Period, Competitors2
Advanced Micro Devices Inc. 93 48 40 49 35
Apple Inc. 104 125 127 104 92
Applied Materials Inc. 43 39 43 47 42
Broadcom Inc. 31 29 44 63 69
Cisco Systems Inc. 39 37 28 21 21
Intel Corp. 51 51 45 39 36
Micron Technology Inc. 48 49 41 44 34
NVIDIA Corp. 41 56 62 49 51
Qualcomm Inc. 58 65 73 70 46
Average Payables Payment Period, Sector
Technology Hardware & Equipment 82 94 94 79 71
Average Payables Payment Period, Industry
Technology 66 76 77 68 64

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 13.45 = 27

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Average payables payment period An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period.

Cash Conversion Cycle

Texas Instruments Inc., cash conversion cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data
Average inventory processing period 140 147 134 127 113
Average receivable collection period 27 28 31 35 33
Average payables payment period 27 32 32 28 26
Short-term Activity Ratio
Cash conversion cycle1 140 143 133 134 120
Benchmarks
Cash Conversion Cycle, Competitors2
Advanced Micro Devices Inc. 101 99 64 62 99
Apple Inc. -63 -84 -86 -71 -60
Applied Materials Inc. 174 159 150 149 141
Broadcom Inc. 54 70 65 67 44
Cisco Systems Inc. 26 40 44 46 49
Intel Corp. 95 82 96 77 87
Micron Technology Inc. 142 117 118 115 93
NVIDIA Corp. 129 67 84 57 71
Qualcomm Inc. 17 41 62 22 34
Cash Conversion Cycle, Sector
Technology Hardware & Equipment -5 -19 -18 -13 -10
Cash Conversion Cycle, Industry
Technology 11 0 1 3 3

Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-24).

1 2019 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 140 + 27 – 27 = 140

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Cash conversion cycle A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. Texas Instruments Inc.’s cash conversion cycle deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019.