Microsoft Excel LibreOffice Calc

Oracle Corp. (NYSE:ORCL)

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)

Oracle Corp., short-term (operating) activity ratios

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Turnover Ratios
Inventory turnover 24.98 20.30 24.90 35.28 23.99 38.29
Receivables turnover 7.69 7.55 7.12 6.88 6.80 6.29
Payables turnover 13.78 15.28 12.47 14.84 9.34 15.36
Working capital turnover 1.42 0.70 0.75 0.79 0.80 1.13
Average No. Days
Average inventory processing period 15 18 15 10 15 10
Add: Average receivable collection period 47 48 51 53 54 58
Operating cycle 62 66 66 63 69 68
Less: Average payables payment period 26 24 29 25 39 24
Cash conversion cycle 36 42 37 38 30 44

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

Short-term activity ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Oracle Corp.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.
Receivables turnover An activity ratio equal to revenue divided by receivables. Oracle Corp.’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. Oracle Corp.’s payables turnover ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.
Working capital turnover An activity ratio calculated as revenue divided by working capital. Oracle Corp.’s working capital turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 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.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. Oracle Corp.’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.
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. Oracle Corp.’s number of days of payables outstanding decreased from 2017 to 2018 but then slightly increased from 2018 to 2019.
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. Oracle Corp.’s cash conversion cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Inventory Turnover

Oracle Corp., inventory turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (US$ in millions)
Cost of revenues 7,995  8,081  7,469  7,479  7,532  7,236 
Inventories 320  398  300  212  314  189 
Short-term Activity Ratio
Inventory turnover1 24.98 20.30 24.90 35.28 23.99 38.29
Benchmarks
Inventory Turnover, Competitors2
Alphabet Inc. 71.97 53.79 60.86 131.11 57.36 —
International Business Machines Corp. 25.11 25.36 27.11 26.80 26.47 —
Microsoft Corp. 20.80 14.41 15.71 14.56 11.38 10.18
Inventory Turnover, Sector
Software & Computer Services 36.66 27.96 29.14 29.05 22.01 —
Inventory Turnover, Industry
Technology 12.91 13.04 11.93 14.19 14.37 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Inventory turnover = Cost of revenues ÷ Inventories
= 7,995 ÷ 320 = 24.98

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. Oracle Corp.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Receivables Turnover

Oracle Corp., receivables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (US$ in millions)
Revenues 39,506  39,831  37,728  37,047  38,226  38,275 
Trade receivables, net of allowances for doubtful accounts 5,134  5,279  5,300  5,385  5,618  6,087 
Short-term Activity Ratio
Receivables turnover1 7.69 7.55 7.12 6.88 6.80 6.29
Benchmarks
Receivables Turnover, Competitors2
Adobe Inc. 7.28 6.86 5.99 7.03 7.14 7.01
Alphabet Inc. 6.39 6.57 6.05 6.39 6.49 —
Facebook Inc. 7.43 7.36 6.97 6.92 7.01 —
International Business Machines Corp. 9.80 10.71 8.86 8.70 9.81 —
Intuit Inc. 77.98 60.86 50.26 43.46 46.07 33.63
Microsoft Corp. 4.26 4.17 4.54 4.67 5.23 4.44
salesforce.com inc. 2.70 2.68 2.63 2.67 2.82 —
ServiceNow Inc. 4.14 4.54 4.44 4.31 4.94 —
Receivables Turnover, Sector
Software & Computer Services 6.01 6.13 6.04 6.19 6.59 —
Receivables Turnover, Industry
Technology 7.50 7.59 7.76 8.15 8.71 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Receivables turnover = Revenues ÷ Trade receivables, net of allowances for doubtful accounts
= 39,506 ÷ 5,134 = 7.69

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. Oracle Corp.’s receivables turnover ratio improved from 2017 to 2018 and from 2018 to 2019.

Payables Turnover

Oracle Corp., payables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (US$ in millions)
Cost of revenues 7,995  8,081  7,469  7,479  7,532  7,236 
Accounts payable 580  529  599  504  806  471 
Short-term Activity Ratio
Payables turnover1 13.78 15.28 12.47 14.84 9.34 15.36
Benchmarks
Payables Turnover, Competitors2
Adobe Inc. 7.98 6.42 8.90 9.31 7.98 9.10
Alphabet Inc. 12.93 13.60 14.53 17.22 14.59 —
Facebook Inc. 9.37 11.41 14.35 12.55 14.63 —
International Business Machines Corp. 8.30 6.50 6.65 6.70 6.81 —
Intuit Inc. 4.26 5.49 5.15 4.09 3.82 4.15
Microsoft Corp. 4.57 4.45 4.64 4.75 5.01 3.64
salesforce.com inc. — — — — — —
ServiceNow Inc. 15.04 20.26 15.56 10.47 8.82 —
Payables Turnover, Sector
Software & Computer Services 8.21 7.68 7.68 7.65 7.29 —
Payables Turnover, Industry
Technology 5.49 4.77 4.77 5.39 5.70 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Payables turnover = Cost of revenues ÷ Accounts payable
= 7,995 ÷ 580 = 13.78

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. Oracle Corp.’s payables turnover ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.

Working Capital Turnover

Oracle Corp., working capital turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (US$ in millions)
Current assets 46,386  75,964  74,515  64,313  63,183  48,138 
Less: Current liabilities 18,630  19,195  24,178  17,208  15,291  14,389 
Working capital 27,756  56,769  50,337  47,105  47,892  33,749 
 
Revenues 39,506  39,831  37,728  37,047  38,226  38,275 
Short-term Activity Ratio
Working capital turnover1 1.42 0.70 0.75 0.79 0.80 1.13
Benchmarks
Working Capital Turnover, Competitors2
Adobe Inc. — 16.24 1.96 1.93 1.84 1.97
Alphabet Inc. 1.51 1.35 1.11 1.02 1.06 —
Facebook Inc. 1.38 1.28 0.91 0.88 0.91 —
International Business Machines Corp. 107.30 7.29 6.40 10.50 9.93 —
Intuit Inc. 4.17 20.71 — — 5.14 3.76
Microsoft Corp. 1.19 0.99 0.94 1.06 1.25 1.27
salesforce.com inc. — — — — — —
ServiceNow Inc. 46.69 7.86 6.24 5.13 2.84 —
Working Capital Turnover, Sector
Software & Computer Services 1.74 1.39 1.25 1.32 1.43 —
Working Capital Turnover, Industry
Technology 2.41 2.23 1.72 1.90 2.12 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Working capital turnover = Revenues ÷ Working capital
= 39,506 ÷ 27,756 = 1.42

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. Oracle Corp.’s working capital turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Average Inventory Processing Period

Oracle Corp., average inventory processing period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data
Inventory turnover 24.98 20.30 24.90 35.28 23.99 38.29
Short-term Activity Ratio (no. days)
Average inventory processing period1 15 18 15 10 15 10
Benchmarks (no. days)
Average Inventory Processing Period, Competitors2
Alphabet Inc. 5 7 6 3 6 —
International Business Machines Corp. 15 14 13 14 14 —
Microsoft Corp. 18 25 23 25 32 36
Average Inventory Processing Period, Sector
Software & Computer Services 10 13 13 13 17 —
Average Inventory Processing Period, Industry
Technology 28 28 31 26 25 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 24.98 = 15

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.

Average Receivable Collection Period

Oracle Corp., average receivable collection period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data
Receivables turnover 7.69 7.55 7.12 6.88 6.80 6.29
Short-term Activity Ratio (no. days)
Average receivable collection period1 47 48 51 53 54 58
Benchmarks (no. days)
Average Receivable Collection Period, Competitors2
Adobe Inc. 50 53 61 52 51 52
Alphabet Inc. 57 56 60 57 56 —
Facebook Inc. 49 50 52 53 52 —
International Business Machines Corp. 37 34 41 42 37 —
Intuit Inc. 5 6 7 8 8 11
Microsoft Corp. 86 88 80 78 70 82
salesforce.com inc. 135 136 139 137 129 —
ServiceNow Inc. 88 80 82 85 74 —
Average Receivable Collection Period, Sector
Software & Computer Services 61 60 60 59 55 —
Average Receivable Collection Period, Industry
Technology 49 48 47 45 42 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 7.69 = 47

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. Oracle Corp.’s number of days of receivables outstanding improved from 2017 to 2018 and from 2018 to 2019.

Operating Cycle

Oracle Corp., operating cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data
Average inventory processing period 15 18 15 10 15 10
Average receivable collection period 47 48 51 53 54 58
Short-term Activity Ratio
Operating cycle1 62 66 66 63 69 68
Benchmarks
Operating Cycle, Competitors2
Alphabet Inc. 62 63 66 60 62 —
International Business Machines Corp. 52 48 54 56 51 —
Microsoft Corp. 104 113 103 103 102 118
Operating Cycle, Sector
Software & Computer Services 71 73 73 72 72 —
Operating Cycle, Industry
Technology 77 76 78 71 67 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 15 + 47 = 62

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.

Average Payables Payment Period

Oracle Corp., average payables payment period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data
Payables turnover 13.78 15.28 12.47 14.84 9.34 15.36
Short-term Activity Ratio (no. days)
Average payables payment period1 26 24 29 25 39 24
Benchmarks (no. days)
Average Payables Payment Period, Competitors2
Adobe Inc. 46 57 41 39 46 40
Alphabet Inc. 28 27 25 21 25 —
Facebook Inc. 39 32 25 29 25 —
International Business Machines Corp. 44 56 55 54 54 —
Intuit Inc. 86 66 71 89 96 88
Microsoft Corp. 80 82 79 77 73 100
salesforce.com inc. — — — — — —
ServiceNow Inc. 24 18 23 35 41 —
Average Payables Payment Period, Sector
Software & Computer Services 44 48 48 48 50 —
Average Payables Payment Period, Industry
Technology 66 76 77 68 64 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 13.78 = 26

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. Oracle Corp.’s number of days of payables outstanding decreased from 2017 to 2018 but then slightly increased from 2018 to 2019.

Cash Conversion Cycle

Oracle Corp., cash conversion cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data
Average inventory processing period 15 18 15 10 15 10
Average receivable collection period 47 48 51 53 54 58
Average payables payment period 26 24 29 25 39 24
Short-term Activity Ratio
Cash conversion cycle1 36 42 37 38 30 44
Benchmarks
Cash Conversion Cycle, Competitors2
Alphabet Inc. 34 36 41 39 37 —
International Business Machines Corp. 8 -8 -1 2 -3 —
Microsoft Corp. 24 31 24 26 29 18
Cash Conversion Cycle, Sector
Software & Computer Services 27 25 25 24 22 —
Cash Conversion Cycle, Industry
Technology 11 0 1 3 3 —

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

1 2019 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 15 + 47 – 26 = 36

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. Oracle Corp.’s cash conversion cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.