Oracle Corp. (NYSE:ORCL)

The analysis of the key turnover and period ratios over the multiple quarterly periods reveals distinct trends and variability across the financial efficiency measures.

Receivables Turnover

The receivables turnover ratio exhibits a general declining trend starting from a high of approximately 9.28 in late 2021, decreasing steadily towards the lower 6.4 range by late 2025. This decline indicates a reduction in the frequency of collecting receivables, suggesting a gradual elongation in the time taken to collect outstanding customer payments over the analyzed timeframe.

Payables Turnover

The payables turnover ratio shows significant volatility with a marked decreasing trend over time. It generally declines from around 14.7 in mid-2020 to a low of under 2 by the end of 2025. This sharp decrease reflects a lengthening payables period, which is consistent with a strategy of extending payment terms or slower payment practices towards suppliers.

Working Capital Turnover

The working capital turnover ratio data is sparse but indicates a sharp increase in late 2021 and early 2022, reaching above 3.8, before data gaps appear. An extraordinary outlier value of 113.15 in late 2025 suggests potential irregularities or a significant operational change, but due to missing data in surrounding periods, this is difficult to interpret fully. Overall, the ratio signals changes in operational efficiency managing working capital during the earlier periods reported.

Average Receivable Collection Period

The average collection period remains relatively stable throughout the periods, fluctuating mostly between 39 and 56 days. There is a mild upward trend from around 43 days in 2020 to mid-50s by late 2025, reinforcing the insight from the receivables turnover that the time to collect receivables has slightly increased, potentially indicating slower cash inflows from clients.

Average Payables Payment Period

The average payables payment period shows a notable increase over time, starting at 25 days in mid-2020 and rising steadily to an extended 193 days by the end of 2025. This substantial extension mirrors the sharp decline in payables turnover and indicates a strategic elongation in the time taken to pay suppliers, which could improve short-term cash retention but might affect supplier relationships.

In summary, there is a clear pattern of elongated payment and collection cycles over the periods under review. The company appears to be collecting receivables more slowly and paying its payables over a longer term. Working capital turnover shows some episodic improvement followed by data inconsistency, limiting comprehensive conclusions. These trends suggest a shift toward more conservative cash management, with increased emphasis on cash conservation through delayed payable settlements, albeit with a slight trade-off in collection efficiency.

The analysis of the quarterly financial data reveals several notable trends in revenues, trade receivables, and receivables turnover over the reported periods.

Revenues

Revenues exhibit an overall upward trend with fluctuations. Starting at approximately 9,367 million USD, revenues increase steadily, peaking at 16,058 million USD in the last reported quarter. Despite some quarters showing slower growth or slight declines, such as around mid-2021 and mid-2023, the general trajectory indicates consistent growth over the longer term. The increase suggests expanding business activities or successful sales strategies contributing to higher top-line performance.

Trade Receivables, Net

The net trade receivables also display a rising trend consistent with revenue growth. Beginning near 4,576 million USD, the figures progressively increase, reaching 9,440 million USD toward the latest quarter. This growth in receivables correlates with rising revenues but also implies an expansion in credit extended to customers or longer collection periods. The pattern indicates that the company is managing larger volumes of billed but not yet collected amounts.

Receivables Turnover Ratio

The receivables turnover ratio demonstrates a declining trend over the periods, decreasing from an initial 8.57 times to 6.46 times in the most recent quarter. This reduction suggests that the company is collecting receivables more slowly relative to its sales. The ratio moved downward notably after mid-2021, with some minor fluctuations but a clear decreasing slope. Lower turnover may point to extended credit terms or challenges in collection efficiency.

Overall, the data reflects positive revenue growth accompanied by increasing trade receivables, suggesting expanding sales activity with greater amounts outstanding. However, the downward trend in receivables turnover indicates a need to monitor collection processes and working capital management to ensure liquidity is maintained despite higher sales volumes.

The cost of revenues exhibits a clear upward trend over the reported periods, increasing from 1,880 million US dollars in August 2020 to 5,374 million US dollars by November 2025. This steady rise suggests an expansion in operational scale or increased input costs. Notable growth spurts are observable particularly from mid-2022 onward, indicating accelerated expenses in generating revenue.

Accounts payable demonstrate a similar increasing trajectory, growing from 534 million US dollars in August 2020 to 10,140 million US dollars by November 2025. The growth in payables is substantial, especially toward the final periods, with a significant jump from 2,423 million in August 2024 to over 10,000 million in November 2025. This could reflect longer payment terms, increased procurement, or strategic working capital management adjustments.

The payables turnover ratio, calculated as cost of revenues divided by accounts payable, shows a declining trend overall. Starting at 14.72 in August 2020, it declines with fluctuations and ends at a low 1.89 by November 2025. This decreasing ratio implies that payables are being settled more slowly relative to the cost of revenues, indicating a lengthening of payment cycles. The ratio’s variability signals periods of both improved and weakened turnover efficiency, with significant drops observed from early 2024 into 2025, suggesting changes in supplier payment practices or liquidity management.

Summary of Trends

- Cost of revenues steadily increases, indicating growth in business volume or cost structure changes.

- Accounts payable rise significantly, especially in the latter periods, implying extended supplier credit or increased purchase volumes.

- Payables turnover ratio decreases, pointing to slower payments to suppliers relative to revenue costs.

- The interplay between rising payables and cost of revenues with declining turnover ratio suggests a strategic shift potentially aimed at optimizing cash flow.

The financial data reveals several notable trends in working capital, revenues, and working capital turnover ratios over multiple quarters.

Working Capital

The working capital exhibits substantial volatility across the periods. Initially, it remains positive and relatively stable from August 2020 to May 2021, with values mostly ranging between approximately 23,000 million and 31,000 million USD. Starting from August 2022, there is a pronounced decline where working capital turns negative, reaching lows around -13,815 million USD. This negative trend continues with fluctuations, occasionally improving but remaining mostly in negative territory through to November 2025. The pattern indicates increasing liquidity tension or greater current liabilities relative to current assets in more recent periods.

Revenues

Revenues show a generally upward trajectory over the observed quarters. From roughly 9,367 million USD in August 2020, revenues continuously increase, reaching peaks around 16,000 million USD by late 2025. Despite some fluctuations, the overall pattern indicates growth in sales or service income, reflecting expansion or increased market activity. The revenue growth is consistent and more stable compared to the volatility seen in working capital.

Working Capital Turnover

The working capital turnover ratio data is incomplete but shows a rising trend until May 2022. Initially, the ratio increases from about 1.26 to a peak of 3.86, suggesting improved efficiency in using working capital to generate revenue. However, data is missing for several subsequent quarters, likely due to negative working capital values, which make the ratio undefined or less meaningful. Notably, an outlier occurs with a very high ratio of 113.15 in one of the later periods, which may indicate an extreme data point caused by near-zero or negative working capital values.

In summary, the company demonstrates strong revenue growth over the examined timeframe, whereas its working capital position deteriorates significantly, turning from positive to deeply negative values. The working capital turnover ratio initially indicates improving operational efficiency, but this metric becomes unreliable during periods of negative working capital, complicating the interpretation of liquidity and operational efficiency in the latter periods. The divergence between robust revenue increases and weakening working capital suggests potential challenges in managing short-term assets and liabilities effectively.

Receivables Turnover Ratio

The receivables turnover ratio shows a fluctuating downward trend over the periods analyzed. Starting at 8.57 in August 2020, the ratio reached a peak of 9.28 in November 2021, indicating a period of more efficient receivables collection. However, from that peak onwards, there is a consistent decline, reaching as low as 6.46 by November 2025. This gradual decrease suggests that the company is collecting its receivables less frequently over time, implying a potential weakening in credit collection efficiency.

Average Receivable Collection Period

Conversely, the average receivable collection period, measured in number of days, exhibits an increasing trend over the same timeline. Initially, the collection period was 43 days in August 2020, decreasing slightly to 39 days in November 2021, which correlates with the peak in the receivables turnover ratio. Subsequently, the collection period lengthens progressively, reaching 56 days by November 2025. This indicates the company takes more time on average to collect its receivables, aligning with the observed decrease in turnover ratio.

Summary of Trends

The inverse relationship between the receivables turnover ratio and the average collection period is evident, with the former declining and the latter increasing over the analyzed periods. Such patterns may point to an emerging challenge in managing accounts receivable, potentially impacting cash flow. The lengthening collection days could be due to relaxed credit policies, changes in customer payment behavior, or other operational factors that would deserve further investigation. Overall, the data suggest a gradual deterioration in receivables management efficiency over the reported periods.

The analysis of the payables turnover and average payables payment period over the quarters reveals notable trends and fluctuations in the company's management of its payables.

Payables Turnover Ratio

The payables turnover ratio exhibits a declining trend from August 2020 through November 2022, decreasing from around 14.72 to 6.68. This indicates a gradual slowdown in the rate at which the company is paying off its suppliers. A recovery is observed by May 2023 when the ratio increases to 11.27 and peaks at 13.67 by November 2023, suggesting a period of accelerated payments.

However, post-November 2023, the ratio sharply declines, reaching as low as 1.89 by November 2025. This pronounced decrease suggests a significant lengthening of the time taken to settle payables or reduced frequency of payments, potentially indicating liquidity constraints or a strategic decision to extend payment terms.

Average Payables Payment Period (in days)

The average payables payment period aligns inversely with the payables turnover ratio. Starting at 25 days in August 2020, the payment period generally increases, peaking at around 55 days between August 2022 and November 2022. This indicates that the company took longer to pay its suppliers during this time frame.

A notable reduction occurs thereafter, with the payment period dropping to 27 days by August 2023, consistent with the earlier observed increase in turnover ratio. This implies a quicker settlement of payables during this period.

Following this, a steep increase in the payment period is evident from February 2024 onward, rising dramatically to 193 days by November 2025. This substantial lengthening of payables days signifies a considerable delay in payments, which may raise concerns regarding supplier relations or financial health.

Overall Observations

The company's payment behavior shows phases of both promptness and delay. Early data reflects moderate payment terms which gradually elongate, suggesting either operational adjustments or external pressures. The interim improvement in payment speed around mid-2023 indicates temporary stabilization.

The significant extension of payables payment periods towards the latest quarters strongly suggests challenges in cash management or a deliberate strategy to preserve cash. This trend warrants close monitoring due to potential impacts on vendor relationships and creditworthiness.