Analysis of Short-term (Operating) Activity Ratios
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
Based on: 10-K (filing date: 2020-06-22), 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).
| 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 improved from 2018 to 2019 and from 2019 to 2020. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Oracle Corp.’s receivables turnover ratio improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Oracle Corp.’s payables turnover ratio decreased from 2018 to 2019 and from 2019 to 2020. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Oracle Corp.’s working capital turnover ratio improved from 2018 to 2019 but then slightly deteriorated from 2019 to 2020. |
| 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. | Oracle Corp.’s number of days of inventory outstanding improved from 2018 to 2019 and from 2019 to 2020. |
| 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 2018 to 2019 but then deteriorated significantly from 2019 to 2020. |
| 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 increased from 2018 to 2019 and from 2019 to 2020. |
| 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 improved from 2018 to 2019 and from 2019 to 2020. |
Inventory Turnover
Oracle Corp., inventory turnover calculation, comparison to benchmarks
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Cost of revenues | 7,938 | 7,995 | 8,081 | 7,469 | 7,479 | 7,532 | |
| Inventories | 211 | 320 | 398 | 300 | 212 | 314 | |
| Short-term Activity Ratio | |||||||
| Inventory turnover1 | 37.62 | 24.98 | 20.30 | 24.90 | 35.28 | 23.99 | |
| 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. | 24.32 | 20.80 | 14.41 | 15.71 | 14.56 | 11.38 | |
| Inventory Turnover, Sector | |||||||
| Software & Computer Services | — | 36.71 | 28.02 | 29.21 | 29.13 | 22.08 | |
| Inventory Turnover, Industry | |||||||
| Technology | — | 12.36 | 12.36 | 11.49 | 13.63 | 13.76 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Inventory turnover = Cost of revenues ÷ Inventories
= 7,938 ÷ 211 = 37.62
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 improved from 2018 to 2019 and from 2019 to 2020. |
Receivables Turnover
Oracle Corp., receivables turnover calculation, comparison to benchmarks
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Revenues | 39,068 | 39,506 | 39,831 | 37,728 | 37,047 | 38,226 | |
| Trade receivables, net of allowances for doubtful accounts | 5,551 | 5,134 | 5,279 | 5,300 | 5,385 | 5,618 | |
| Short-term Activity Ratio | |||||||
| Receivables turnover1 | 7.04 | 7.69 | 7.55 | 7.12 | 6.88 | 6.80 | |
| Benchmarks | |||||||
| Receivables Turnover, Competitors2 | |||||||
| Adobe Inc. | — | 7.28 | 6.86 | 5.99 | 7.03 | 7.14 | |
| Alphabet Inc. | — | 6.39 | 6.57 | 6.05 | 6.39 | 6.49 | |
| Autodesk Inc. | 5.02 | 5.42 | 4.69 | 4.49 | 3.83 | 5.47 | |
| 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. | 51.54 | 77.98 | 60.86 | 50.26 | 43.46 | 46.07 | |
| Microsoft Corp. | 4.47 | 4.26 | 4.17 | 4.54 | 4.67 | 5.23 | |
| salesforce.com inc. | 2.77 | 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 | 6.12 | 6.03 | 6.16 | 6.58 | |
| Receivables Turnover, Industry | |||||||
| Technology | — | 7.50 | 7.54 | 7.69 | 8.07 | 8.64 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Receivables turnover = Revenues ÷ Trade receivables, net of allowances for doubtful accounts
= 39,068 ÷ 5,551 = 7.04
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 2018 to 2019 but then deteriorated significantly from 2019 to 2020. |
Payables Turnover
Oracle Corp., payables turnover calculation, comparison to benchmarks
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Cost of revenues | 7,938 | 7,995 | 8,081 | 7,469 | 7,479 | 7,532 | |
| Accounts payable | 637 | 580 | 529 | 599 | 504 | 806 | |
| Short-term Activity Ratio | |||||||
| Payables turnover1 | 12.46 | 13.78 | 15.28 | 12.47 | 14.84 | 9.34 | |
| Benchmarks | |||||||
| Payables Turnover, Competitors2 | |||||||
| Adobe Inc. | — | 7.98 | 6.42 | 8.90 | 9.31 | 7.98 | |
| Alphabet Inc. | — | 12.93 | 13.60 | 14.53 | 17.22 | 14.59 | |
| Autodesk Inc. | 3.88 | 2.81 | 3.20 | 3.66 | 3.09 | 3.40 | |
| 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. | 4.52 | 4.26 | 5.49 | 5.15 | 4.09 | 3.82 | |
| Microsoft Corp. | 3.68 | 4.57 | 4.45 | 4.64 | 4.75 | 5.01 | |
| salesforce.com inc. | — | — | — | — | — | — | |
| ServiceNow Inc. | — | 15.04 | 20.26 | 15.56 | 10.47 | 8.82 | |
| Payables Turnover, Sector | |||||||
| Software & Computer Services | — | 8.19 | 7.66 | 7.66 | 7.62 | 7.27 | |
| Payables Turnover, Industry | |||||||
| Technology | — | 5.54 | 4.82 | 4.80 | 5.41 | 5.72 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Payables turnover = Cost of revenues ÷ Accounts payable
= 7,938 ÷ 637 = 12.46
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 decreased from 2018 to 2019 and from 2019 to 2020. |
Working Capital Turnover
Oracle Corp., working capital turnover calculation, comparison to benchmarks
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Current assets | 52,140 | 46,386 | 75,964 | 74,515 | 64,313 | 63,183 | |
| Less: Current liabilities | 17,200 | 18,630 | 19,195 | 24,178 | 17,208 | 15,291 | |
| Working capital | 34,940 | 27,756 | 56,769 | 50,337 | 47,105 | 47,892 | |
| Revenues | 39,068 | 39,506 | 39,831 | 37,728 | 37,047 | 38,226 | |
| Short-term Activity Ratio | |||||||
| Working capital turnover1 | 1.12 | 1.42 | 0.70 | 0.75 | 0.79 | 0.80 | |
| Benchmarks | |||||||
| Working Capital Turnover, Competitors2 | |||||||
| Adobe Inc. | — | — | 16.24 | 1.96 | 1.93 | 1.84 | |
| Alphabet Inc. | — | 1.51 | 1.35 | 1.11 | 1.02 | 1.06 | |
| Autodesk Inc. | — | — | — | 7.38 | 1.79 | 1.98 | |
| 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. | 1.73 | 4.17 | 20.71 | — | — | 5.14 | |
| Microsoft Corp. | 1.30 | 1.19 | 0.99 | 0.94 | 1.06 | 1.25 | |
| salesforce.com inc. | 15.29 | — | — | — | — | — | |
| ServiceNow Inc. | — | 46.69 | 7.86 | 6.24 | 5.13 | 2.84 | |
| Working Capital Turnover, Sector | |||||||
| Software & Computer Services | — | 1.76 | 1.40 | 1.25 | 1.32 | 1.44 | |
| Working Capital Turnover, Industry | |||||||
| Technology | — | 2.42 | 2.24 | 1.73 | 1.87 | 2.10 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Working capital turnover = Revenues ÷ Working capital
= 39,068 ÷ 34,940 = 1.12
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 improved from 2018 to 2019 but then slightly deteriorated from 2019 to 2020. |
Average Inventory Processing Period
Oracle Corp., average inventory processing period calculation, comparison to benchmarks
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Inventory turnover | 37.62 | 24.98 | 20.30 | 24.90 | 35.28 | 23.99 | |
| Short-term Activity Ratio (no. days) | |||||||
| Average inventory processing period1 | 10 | 15 | 18 | 15 | 10 | 15 | |
| 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. | 15 | 18 | 25 | 23 | 25 | 32 | |
| Average Inventory Processing Period, Sector | |||||||
| Software & Computer Services | — | 10 | 13 | 12 | 13 | 17 | |
| Average Inventory Processing Period, Industry | |||||||
| Technology | — | 30 | 30 | 32 | 27 | 27 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 37.62 = 10
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. | Oracle Corp.’s number of days of inventory outstanding improved from 2018 to 2019 and from 2019 to 2020. |
Average Receivable Collection Period
Oracle Corp., average receivable collection period calculation, comparison to benchmarks
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Receivables turnover | 7.04 | 7.69 | 7.55 | 7.12 | 6.88 | 6.80 | |
| Short-term Activity Ratio (no. days) | |||||||
| Average receivable collection period1 | 52 | 47 | 48 | 51 | 53 | 54 | |
| Benchmarks (no. days) | |||||||
| Average Receivable Collection Period, Competitors2 | |||||||
| Adobe Inc. | — | 50 | 53 | 61 | 52 | 51 | |
| Alphabet Inc. | — | 57 | 56 | 60 | 57 | 56 | |
| Autodesk Inc. | 73 | 67 | 78 | 81 | 95 | 67 | |
| Facebook Inc. | — | 49 | 50 | 52 | 53 | 52 | |
| International Business Machines Corp. | — | 37 | 34 | 41 | 42 | 37 | |
| Intuit Inc. | 7 | 5 | 6 | 7 | 8 | 8 | |
| Microsoft Corp. | 82 | 86 | 88 | 80 | 78 | 70 | |
| salesforce.com inc. | 132 | 135 | 136 | 139 | 137 | 129 | |
| ServiceNow Inc. | — | 88 | 80 | 82 | 85 | 74 | |
| Average Receivable Collection Period, Sector | |||||||
| Software & Computer Services | — | 61 | 60 | 61 | 59 | 55 | |
| Average Receivable Collection Period, Industry | |||||||
| Technology | — | 49 | 48 | 47 | 45 | 42 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 7.04 = 52
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 2018 to 2019 but then deteriorated significantly from 2019 to 2020. |
Operating Cycle
Oracle Corp., operating cycle calculation, comparison to benchmarks
No. days
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Average inventory processing period | 10 | 15 | 18 | 15 | 10 | 15 | |
| Average receivable collection period | 52 | 47 | 48 | 51 | 53 | 54 | |
| Short-term Activity Ratio | |||||||
| Operating cycle1 | 62 | 62 | 66 | 66 | 63 | 69 | |
| Benchmarks | |||||||
| Operating Cycle, Competitors2 | |||||||
| Alphabet Inc. | — | 62 | 63 | 66 | 60 | 62 | |
| International Business Machines Corp. | — | 52 | 48 | 54 | 56 | 51 | |
| Microsoft Corp. | 97 | 104 | 113 | 103 | 103 | 102 | |
| Operating Cycle, Sector | |||||||
| Software & Computer Services | — | 71 | 73 | 73 | 72 | 72 | |
| Operating Cycle, Industry | |||||||
| Technology | — | 79 | 78 | 79 | 72 | 69 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 10 + 52 = 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
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Payables turnover | 12.46 | 13.78 | 15.28 | 12.47 | 14.84 | 9.34 | |
| Short-term Activity Ratio (no. days) | |||||||
| Average payables payment period1 | 29 | 26 | 24 | 29 | 25 | 39 | |
| Benchmarks (no. days) | |||||||
| Average Payables Payment Period, Competitors2 | |||||||
| Adobe Inc. | — | 46 | 57 | 41 | 39 | 46 | |
| Alphabet Inc. | — | 28 | 27 | 25 | 21 | 25 | |
| Autodesk Inc. | 94 | 130 | 114 | 100 | 118 | 107 | |
| Facebook Inc. | — | 39 | 32 | 25 | 29 | 25 | |
| International Business Machines Corp. | — | 44 | 56 | 55 | 54 | 54 | |
| Intuit Inc. | 81 | 86 | 66 | 71 | 89 | 96 | |
| Microsoft Corp. | 99 | 80 | 82 | 79 | 77 | 73 | |
| salesforce.com inc. | — | — | — | — | — | — | |
| ServiceNow Inc. | — | 24 | 18 | 23 | 35 | 41 | |
| Average Payables Payment Period, Sector | |||||||
| Software & Computer Services | — | 45 | 48 | 48 | 48 | 50 | |
| Average Payables Payment Period, Industry | |||||||
| Technology | — | 66 | 76 | 76 | 67 | 64 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 12.46 = 29
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 increased from 2018 to 2019 and from 2019 to 2020. |
Cash Conversion Cycle
Oracle Corp., cash conversion cycle calculation, comparison to benchmarks
No. days
| May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | May 31, 2016 | May 31, 2015 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Average inventory processing period | 10 | 15 | 18 | 15 | 10 | 15 | |
| Average receivable collection period | 52 | 47 | 48 | 51 | 53 | 54 | |
| Average payables payment period | 29 | 26 | 24 | 29 | 25 | 39 | |
| Short-term Activity Ratio | |||||||
| Cash conversion cycle1 | 33 | 36 | 42 | 37 | 38 | 30 | |
| Benchmarks | |||||||
| Cash Conversion Cycle, Competitors2 | |||||||
| Alphabet Inc. | — | 34 | 36 | 41 | 39 | 37 | |
| International Business Machines Corp. | — | 8 | -8 | -1 | 2 | -3 | |
| Microsoft Corp. | -2 | 24 | 31 | 24 | 26 | 29 | |
| Cash Conversion Cycle, Sector | |||||||
| Software & Computer Services | — | 26 | 25 | 25 | 24 | 22 | |
| Cash Conversion Cycle, Industry | |||||||
| Technology | — | 13 | 2 | 3 | 5 | 5 | |
Based on: 10-K (filing date: 2020-06-22), 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).
1 2020 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 10 + 52 – 29 = 33
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 improved from 2018 to 2019 and from 2019 to 2020. |