Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
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Liquidity Ratios (Summary)
Corning Inc., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31).
- Current Ratio
- The current ratio demonstrates a general downward trend over the analyzed period. Starting at 2.18 in the first quarter of 2020, it initially increased to 2.31 by the first quarter of 2021, suggesting a temporary strengthening of short-term liquidity. However, from mid-2021 onward, the ratio declined significantly and stabilized in the range of approximately 1.43 to 1.7 during 2022 and early 2023, indicating reduced liquidity relative to current liabilities. The ratio showed minor improvement towards the end of 2023 and early 2024, maintaining a level around 1.67 in the first quarter of 2024.
- Quick Ratio
- The quick ratio also follows a similar decreasing trajectory. It was relatively stable and above 1.0 through the first quarter of 2021, peaking at 1.36. Subsequently, this ratio experienced a notable decline, falling below 1.0 starting from mid-2021 and reaching a low of 0.59 by the first quarter of 2023. Although a slight recovery is observed through the rest of 2023, the quick ratio remains below 1.0 into early 2024 at 0.72. This indicates a reduced buffer of liquid assets excluding inventories to meet current liabilities.
- Cash Ratio
- The cash ratio presents the most pronounced decline among the three liquidity measures. Beginning at 0.63 in early 2020, it rose somewhat to a peak of 0.82 in the first quarter of 2021. Thereafter, it decreased markedly, falling steadily through 2022 and 2023 and reaching lower levels around 0.24 to 0.41. The ratio slightly improved towards the end of 2023 but declined again to 0.33 in the first quarter of 2024. This pattern suggests a significant drop in highly liquid cash assets relative to current liabilities over the period.
- Overall Analysis
- The liquidity ratios indicate a clear weakening trend in the company’s ability to cover short-term obligations with current assets over the given time frame. The initial strength in early 2020 and into early 2021 was followed by a period of decreased liquidity across all ratios. While there are moderate recoveries in some quarters, the ratios remain below earlier peak levels, especially the quick and cash ratios. This could reflect changes in working capital management, asset composition, or increased current liabilities, potentially signaling heightened liquidity risk or a strategic shift in asset allocation.
Current Ratio
Corning Inc., current ratio calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Current assets | |||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||
| Current ratio1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||
| Apple Inc. | |||||||||||||||||||||||
| Arista Networks Inc. | |||||||||||||||||||||||
| Cisco Systems Inc. | |||||||||||||||||||||||
| Dell Technologies Inc. | |||||||||||||||||||||||
| Super Micro Computer Inc. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31).
1 Q1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals distinct trends in current assets, current liabilities, and the current ratio over the observed period.
- Current Assets
- Current assets exhibited fluctuations, starting at 6,946 million USD in the first quarter of 2020, increasing to a peak of 8,103 million USD by the first quarter of 2021. Following this peak, the current assets generally declined with minor recoveries, reaching approximately 6,971 million USD by the first quarter of 2024. The overall pattern suggests periods of asset accumulation followed by gradual reduction towards the latter quarters.
- Current Liabilities
- Current liabilities showed a steady increase from 3,191 million USD in the first quarter of 2020 to 5,306 million USD in the mid-2022 timeframe. After this peak, there was a slight decrease with minor fluctuations, resulting in 4,175 million USD by the first quarter of 2024. This indicates an initial rise in short-term obligations, stabilizing and moderately declining towards the end of the period.
- Current Ratio
- The current ratio started at a strong level of 2.18 in early 2020, climbing to a peak of 2.31 in the first quarter of 2021. Subsequently, it declined sharply to 1.43 by the second quarter of 2022. After this low point, it displayed a moderate recovery, stabilizing around 1.65 to 1.70 towards the end of the observed period, ending at 1.67 in the first quarter of 2024. This indicates a decrease in short-term liquidity during the mid-period, with partial improvement thereafter but without reaching initial levels.
Overall, while the company initially maintained a healthy liquidity position with strong current assets relative to liabilities, this balance shifted over time. The rise in current liabilities outpaced the growth in current assets mid-period, leading to a reduced current ratio and suggesting tighter short-term financial flexibility. The latter quarters show some stabilization and minor improvement in liquidity ratios, although the current ratio remains below early 2020 levels.
Quick Ratio
Corning Inc., quick ratio calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Cash and cash equivalents | |||||||||||||||||||||||
| Trade accounts receivable, net of doubtful accounts | |||||||||||||||||||||||
| Total quick assets | |||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||
| Quick ratio1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||
| Apple Inc. | |||||||||||||||||||||||
| Arista Networks Inc. | |||||||||||||||||||||||
| Cisco Systems Inc. | |||||||||||||||||||||||
| Dell Technologies Inc. | |||||||||||||||||||||||
| Super Micro Computer Inc. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31).
1 Q1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The analysis of the recent financial data reveals discernible trends in the liquidity position of the company through its key indicators: total quick assets, current liabilities, and the quick ratio.
- Total Quick Assets
- Total quick assets demonstrated an overall declining trend over the observed period. Starting at $3,733 million in the first quarter of 2020, the figure peaked at $4,805 million by the end of that year. Following this peak, a downward trajectory is evident, with fluctuations but a general decrease reaching approximately $2,986 million by the first quarter of 2024. This decline suggests a reduction in liquid assets readily available to meet short-term obligations.
- Current Liabilities
- Current liabilities exhibited an increasing trend throughout the same period. Beginning at $3,191 million in March 2020, liabilities escalated to $5,061 million by March 2022. Although there were minor decreases during late 2022 and early 2023, the values remained relatively elevated, ending at $4,175 million in the first quarter of 2024. The upward movement in current liabilities indicates a growing short-term financial obligation for the company.
- Quick Ratio
- The quick ratio, which measures the ability to cover current liabilities with liquid assets, correspondingly declined from 1.17 in March 2020 to 0.72 by March 2024. The ratio initially improved, reaching a high of 1.36 in March 2021, but subsequently fell below 1.0, maintaining values predominantly between 0.59 and 0.86 after mid-2021. The persistent ratio below 1.0 since mid-2021 reveals that quick assets have been insufficient to cover current liabilities, signaling a weakening liquidity position.
In summary, the company's liquidity has systematically weakened over the analyzed quarters due to decreasing quick assets and rising current liabilities. The quick ratio's sustained position below 1.0 for several consecutive quarters implies increased risk in meeting short-term obligations solely through liquid assets, highlighting a potential area of concern for financial resilience and operational flexibility.
Cash Ratio
Corning Inc., cash ratio calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Cash and cash equivalents | |||||||||||||||||||||||
| Total cash assets | |||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||
| Cash ratio1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||
| Apple Inc. | |||||||||||||||||||||||
| Arista Networks Inc. | |||||||||||||||||||||||
| Cisco Systems Inc. | |||||||||||||||||||||||
| Dell Technologies Inc. | |||||||||||||||||||||||
| Super Micro Computer Inc. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31).
1 Q1 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial position reveals notable trends in the liquidity and short-term financial obligations over the examined periods.
- Total cash assets
-
The total cash assets exhibited initial growth from early 2020 through the first quarter of 2021, peaking around March 31, 2021. Subsequently, there was a general decline with some fluctuations, reaching lower values in mid-2023 before slightly recovering towards the end of 2023 and early 2024. Despite this recovery, cash assets in the latest quarter are lower than the initial values observed in 2020.
- Current liabilities
-
Current liabilities demonstrated an overall upward trend, increasing significantly from 2020 into 2022. The peak levels occurred between mid-2021 and the end of 2022, with liabilities somewhat stabilizing but remaining elevated through 2023 and into early 2024. This upward shift indicates increasing short-term obligations over the period analyzed.
- Cash ratio
-
The cash ratio, which measures the ability to cover current liabilities with cash assets, started relatively strong, peaking around the first quarter of 2021. However, it declined sharply thereafter and remained low throughout 2022 and 2023. Despite minor improvements in some quarters, the ratio stayed below 0.5 in most periods after mid-2021, reflecting reduced liquidity relative to short-term liabilities. The ratio in early 2024 remains subdued compared to the earliest periods.
In summary, while cash assets showed an initial increase followed by a decline and partial recovery, current liabilities increased steadily and maintained high levels. This dynamic contributed to a marked decrease in the cash ratio after early 2021, indicating a diminished short-term liquidity position and potentially greater reliance on other sources of funding to meet current obligations.