Texas Instruments Inc. (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
Based on: 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), 10-K (filing date: 2015-02-24).
| 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 2016 to 2017 and from 2017 to 2018. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Texas Instruments Inc.’s receivables turnover ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Texas Instruments Inc.’s payables turnover ratio decreased from 2016 to 2017 but then slightly increased from 2017 to 2018. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Texas Instruments Inc.’s working capital turnover ratio deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level. |
| 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 2016 to 2017 and from 2017 to 2018. |
| 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 2016 to 2017 and from 2017 to 2018. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Texas Instruments Inc.’s operating cycle deteriorated from 2016 to 2017 and from 2017 to 2018. |
| 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 improved from 2016 to 2017 but then deteriorated significantly from 2017 to 2018. |
Inventory Turnover
Texas Instruments Inc., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of revenue (COR) | 5,507 | 5,347 | 5,130 | 5,440 | 5,618 | |
| Inventories | 2,217 | 1,957 | 1,790 | 1,691 | 1,784 | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 2.48 | 2.73 | 2.87 | 3.22 | 3.15 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Apple Inc. | 41.39 | 29.05 | 61.62 | 59.64 | 53.18 | |
| Applied Materials Inc. | 2.54 | 2.73 | 3.08 | 3.11 | 3.34 | |
| Broadcom Inc. | 9.00 | 6.31 | 5.21 | 6.24 | 4.61 | |
| Cisco Systems Inc. | 10.14 | 11.00 | 15.03 | 11.97 | 12.18 | |
| Intel Corp. | 3.74 | 3.39 | 4.18 | 4.00 | — | |
| Micron Technology Inc. | 3.48 | 3.81 | 3.42 | 4.69 | 4.45 | |
| NVIDIA Corp. | 4.89 | 3.59 | 5.26 | 4.31 | 4.80 | |
| Qualcomm Inc. | 6.05 | 4.81 | 6.27 | 6.96 | 7.33 | |
| Inventory Turnover, Sector | ||||||
| Technology Hardware & Equipment | 9.97 | 8.92 | 11.23 | 12.46 | — | |
| Inventory Turnover, Industry | ||||||
| Technology | 13.24 | 12.09 | 14.49 | 14.65 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Inventory turnover = Cost of revenue (COR) ÷ Inventories
= 5,507 ÷ 2,217 = 2.48
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 2016 to 2017 and from 2017 to 2018. |
Receivables Turnover
Texas Instruments Inc., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 15,784 | 14,961 | 13,370 | 13,000 | 13,045 | |
| Accounts receivable, net of allowances | 1,207 | 1,278 | 1,267 | 1,165 | 1,246 | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 13.08 | 11.71 | 10.55 | 11.16 | 10.47 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Apple Inc. | 11.45 | 12.82 | 13.69 | 13.87 | 10.47 | |
| Applied Materials Inc. | 6.73 | 6.22 | 4.75 | 5.55 | 5.43 | |
| Broadcom Inc. | 6.27 | 7.20 | 6.07 | 6.70 | 5.46 | |
| Cisco Systems Inc. | 8.88 | 9.33 | 8.42 | 9.20 | 9.14 | |
| Intel Corp. | 10.54 | 11.19 | 12.66 | 11.56 | — | |
| Micron Technology Inc. | 6.01 | 5.82 | 7.02 | 7.40 | 6.48 | |
| NVIDIA Corp. | 7.68 | 8.37 | 9.92 | 9.88 | 9.69 | |
| Qualcomm Inc. | 7.98 | 6.23 | 10.74 | 13.02 | 11.21 | |
| Receivables Turnover, Sector | ||||||
| Technology Hardware & Equipment | 9.71 | 10.25 | 11.04 | 11.66 | — | |
| Receivables Turnover, Industry | ||||||
| Technology | 7.62 | 7.75 | 8.14 | 8.73 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Receivables turnover = Revenue ÷ Accounts receivable, net of allowances
= 15,784 ÷ 1,207 = 13.08
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 2016 to 2017 and from 2017 to 2018. |
Payables Turnover
Texas Instruments Inc., payables turnover calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of revenue (COR) | 5,507 | 5,347 | 5,130 | 5,440 | 5,618 | |
| Accounts payable | 478 | 466 | 396 | 386 | 437 | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 11.52 | 11.47 | 12.95 | 14.09 | 12.86 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Apple Inc. | 2.93 | 2.88 | 3.52 | 3.95 | 3.72 | |
| Applied Materials Inc. | 9.47 | 8.47 | 7.77 | 8.67 | 8.53 | |
| Broadcom Inc. | 12.47 | 8.26 | 5.79 | 5.30 | 4.64 | |
| Cisco Systems Inc. | 9.83 | 12.84 | 17.32 | 17.64 | 18.77 | |
| Intel Corp. | 7.09 | 8.09 | 9.37 | 10.02 | — | |
| Micron Technology Inc. | 7.39 | 8.92 | 8.34 | 10.76 | 9.76 | |
| NVIDIA Corp. | 6.53 | 5.87 | 7.43 | 7.10 | 5.74 | |
| Qualcomm Inc. | 5.61 | 4.97 | 5.25 | 7.98 | 4.90 | |
| Payables Turnover, Sector | ||||||
| Technology Hardware & Equipment | 3.84 | 3.85 | 4.58 | 5.08 | — | |
| Payables Turnover, Industry | ||||||
| Technology | 4.75 | 4.73 | 5.36 | 5.67 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Payables turnover = Cost of revenue (COR) ÷ Accounts payable
= 5,507 ÷ 478 = 11.52
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 decreased from 2016 to 2017 but then slightly increased from 2017 to 2018. |
Working Capital Turnover
Texas Instruments Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 8,097 | 8,734 | 7,457 | 7,074 | 7,768 | |
| Less: Current liabilities | 2,474 | 2,258 | 2,264 | 2,555 | 2,662 | |
| Working capital | 5,623 | 6,476 | 5,193 | 4,519 | 5,106 | |
| Revenue | 15,784 | 14,961 | 13,370 | 13,000 | 13,045 | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 2.81 | 2.31 | 2.57 | 2.88 | 2.55 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Apple Inc. | 18.35 | 8.24 | 7.74 | 26.66 | 35.96 | |
| Applied Materials Inc. | 2.58 | 1.65 | 2.29 | 1.77 | 2.19 | |
| Broadcom Inc. | 3.08 | 1.33 | 3.27 | 2.57 | 1.51 | |
| Cisco Systems Inc. | 1.42 | 0.86 | 0.92 | 0.93 | 1.00 | |
| Intel Corp. | 5.83 | 5.20 | 3.91 | 2.24 | — | |
| Micron Technology Inc. | 2.95 | 2.85 | 2.66 | 3.45 | 3.01 | |
| NVIDIA Corp. | 1.20 | 1.02 | 1.35 | 0.97 | 0.88 | |
| Qualcomm Inc. | 3.70 | 0.68 | 1.50 | 1.58 | 1.62 | |
| Working Capital Turnover, Sector | ||||||
| Technology Hardware & Equipment | 4.78 | 2.55 | 2.99 | 3.33 | — | |
| Working Capital Turnover, Industry | ||||||
| Technology | 2.22 | 1.71 | 1.89 | 2.11 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Working capital turnover = Revenue ÷ Working capital
= 15,784 ÷ 5,623 = 2.81
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 deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level. |
Average Inventory Processing Period
Texas Instruments Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 2.48 | 2.73 | 2.87 | 3.22 | 3.15 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 147 | 134 | 127 | 113 | 116 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Apple Inc. | 9 | 13 | 6 | 6 | 7 | |
| Applied Materials Inc. | 144 | 134 | 119 | 117 | 109 | |
| Broadcom Inc. | 41 | 58 | 70 | 58 | 79 | |
| Cisco Systems Inc. | 36 | 33 | 24 | 30 | 30 | |
| Intel Corp. | 98 | 108 | 87 | 91 | — | |
| Micron Technology Inc. | 105 | 96 | 107 | 78 | 82 | |
| NVIDIA Corp. | 75 | 102 | 69 | 85 | 76 | |
| Qualcomm Inc. | 60 | 76 | 58 | 52 | 50 | |
| Average Inventory Processing Period, Sector | ||||||
| Technology Hardware & Equipment | 37 | 41 | 32 | 29 | — | |
| Average Inventory Processing Period, Industry | ||||||
| Technology | 28 | 30 | 25 | 25 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 2.48 = 147
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 2016 to 2017 and from 2017 to 2018. |
Average Receivable Collection Period
Texas Instruments Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 13.08 | 11.71 | 10.55 | 11.16 | 10.47 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 28 | 31 | 35 | 33 | 35 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Apple Inc. | 32 | 28 | 27 | 26 | 35 | |
| Applied Materials Inc. | 54 | 59 | 77 | 66 | 67 | |
| Broadcom Inc. | 58 | 51 | 60 | 55 | 67 | |
| Cisco Systems Inc. | 41 | 39 | 43 | 40 | 40 | |
| Intel Corp. | 35 | 33 | 29 | 32 | — | |
| Micron Technology Inc. | 61 | 63 | 52 | 49 | 56 | |
| NVIDIA Corp. | 48 | 44 | 37 | 37 | 38 | |
| Qualcomm Inc. | 46 | 59 | 34 | 28 | 33 | |
| Average Receivable Collection Period, Sector | ||||||
| Technology Hardware & Equipment | 38 | 36 | 33 | 31 | — | |
| Average Receivable Collection Period, Industry | ||||||
| Technology | 48 | 47 | 45 | 42 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 13.08 = 28
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 2016 to 2017 and from 2017 to 2018. |
Operating Cycle
Texas Instruments Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 147 | 134 | 127 | 113 | 116 | |
| Average receivable collection period | 28 | 31 | 35 | 33 | 35 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 175 | 165 | 162 | 146 | 151 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Apple Inc. | 41 | 41 | 33 | 32 | 42 | |
| Applied Materials Inc. | 198 | 193 | 196 | 183 | 176 | |
| Broadcom Inc. | 99 | 109 | 130 | 113 | 146 | |
| Cisco Systems Inc. | 77 | 72 | 67 | 70 | 70 | |
| Intel Corp. | 133 | 141 | 116 | 123 | — | |
| Micron Technology Inc. | 166 | 159 | 159 | 127 | 138 | |
| NVIDIA Corp. | 123 | 146 | 106 | 122 | 114 | |
| Qualcomm Inc. | 106 | 135 | 92 | 80 | 83 | |
| Operating Cycle, Sector | ||||||
| Technology Hardware & Equipment | 75 | 77 | 65 | 60 | — | |
| Operating Cycle, Industry | ||||||
| Technology | 76 | 77 | 70 | 67 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 147 + 28 = 175
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 2016 to 2017 and from 2017 to 2018. |
Average Payables Payment Period
Texas Instruments Inc., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 11.52 | 11.47 | 12.95 | 14.09 | 12.86 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 32 | 32 | 28 | 26 | 28 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Apple Inc. | 125 | 127 | 104 | 92 | 98 | |
| Applied Materials Inc. | 39 | 43 | 47 | 42 | 43 | |
| Broadcom Inc. | 29 | 44 | 63 | 69 | 79 | |
| Cisco Systems Inc. | 37 | 28 | 21 | 21 | 19 | |
| Intel Corp. | 51 | 45 | 39 | 36 | — | |
| Micron Technology Inc. | 49 | 41 | 44 | 34 | 37 | |
| NVIDIA Corp. | 56 | 62 | 49 | 51 | 64 | |
| Qualcomm Inc. | 65 | 73 | 70 | 46 | 75 | |
| Average Payables Payment Period, Sector | ||||||
| Technology Hardware & Equipment | 95 | 95 | 80 | 72 | — | |
| Average Payables Payment Period, Industry | ||||||
| Technology | 77 | 77 | 68 | 64 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 11.52 = 32
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
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 147 | 134 | 127 | 113 | 116 | |
| Average receivable collection period | 28 | 31 | 35 | 33 | 35 | |
| Average payables payment period | 32 | 32 | 28 | 26 | 28 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 143 | 133 | 134 | 120 | 123 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Apple Inc. | -84 | -86 | -71 | -60 | -56 | |
| Applied Materials Inc. | 159 | 150 | 149 | 141 | 133 | |
| Broadcom Inc. | 70 | 65 | 67 | 44 | 67 | |
| Cisco Systems Inc. | 40 | 44 | 46 | 49 | 51 | |
| Intel Corp. | 82 | 96 | 77 | 87 | — | |
| Micron Technology Inc. | 117 | 118 | 115 | 93 | 101 | |
| NVIDIA Corp. | 67 | 84 | 57 | 71 | 50 | |
| Qualcomm Inc. | 41 | 62 | 22 | 34 | 8 | |
| Cash Conversion Cycle, Sector | ||||||
| Technology Hardware & Equipment | -20 | -18 | -15 | -12 | — | |
| Cash Conversion Cycle, Industry | ||||||
| Technology | -1 | 0 | 2 | 3 | — | |
Based on: 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), 10-K (filing date: 2015-02-24).
1 2018 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 147 + 28 – 32 = 143
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 improved from 2016 to 2017 but then deteriorated significantly from 2017 to 2018. |